Describe the following term: "Purchase of new capital". It relates to: a. Price Level. b....

Question:

Describe the following term: "Purchase of new capital". It relates to:

a. Price Level.

b. Inflation.

c. Income.

d. One Component of Income.

e. None of the Above.

Capital:

In economics, capital denotes a certain factor of production that is purchased in order to build wealth by providing a return through given rates. Machinery is an example of capital used by firms.

Answer and Explanation:

Describe the following term: "Purchase of new capital". It relates to:

a. Price Level.

b. Inflation.

c. Income.

d. One Component of Income. {eq}\checkmark {/eq}

e. None of the Above.

Purchases of new capital will show up on GDP flows, which is a method of national income accounting


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Overview of the Gross Domestic Product

from CLEP Social Sciences and History: Study Guide & Test Prep

Chapter 59 / Lesson 2
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