Expenditures for consumer goods and services $8,200 Esports $1,700 Government pu

Question

Expenditures for consumer goods and services $8,200 Esports $1,700 Government purchases of goods aservices$2,500 Social Security taxes Net investment Indirect business taxes Imports Gross investment Corporate income taxes Personal income taxes Corporate retained earnings Net foreign factor income Government transfer pakments to households Net interest payments to households $1,900 $1,400 $1.400 $1,900 $1,800 $600 $1,500 $130 $100 $1.600 $500 Table 5.3 National Income Accounts (dollar figures are in billions) On the basis of Table 5.3, the net addition to the capital stock is O $1,000 billion. O $1,400 billion. O $400 billion ?$370 billion. 12 MacBook Air

Explanation / Answer

Net addition to the capital stock indicates total addition to the capital stock minus depreciation.

The value of net addition to the capital stock is same as that of the net investment.

This is because net investment equals gross investment (which is total addition to the capital stock) minus depreciation.

The net investment is $1,400 billion.

So,

The net addition to the capital stock is $1,400 billion.

Hence, the correct answer is the option (2) [$1,400 billion].

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