QUESTIONS FROM CHAPTER 7 1. Which one of the following is not an example of natu
ID: 1107949 • Letter: Q
Question
QUESTIONS FROM CHAPTER 7 1. Which one of the following is not an example of natural capital? a) The ozone layer b) A river c) A road d) Soil e) Air 2. The process of adding to productive capital over time is referred to as... a) Capital depreciation b) Net disinvestment c) Physical accounting d) Net investment e) Strong sustainability 3. Suppose you receive $10,000 and the prevailing interest rate is 10%. Using the definition of income proposed by John Hicks, what is your annual income (assume zero inflation)? a) $100,000 b) $10,000 c) $1,000 d) $100 c) so 4. Which one of the following statements about national accounting is false? a) Gross National Product does not account for natural capital depreciation b) Net investment is gross investment minus depreciation c) Capital depreciation accounts for wearing-out of human-made capital over time d) A negative net investment implies a decline in national wealth e) Net National Product does not account for capital depreciation 5. Which one of the following measures can be used to account for natural capital levels? a) Satellite accounts b) Net investment c) Gross investment d) Net National Product e) Gross National ProductExplanation / Answer
1. Ans: A road
Explanation:
Natural capital is defined as the stocks of natural assets which include geology, soil, air, water and all living things. Thus, a road is not a natural capita.
2. Ans: Net investment
Explanation:
The process of adding to productive capital over time is called net investment and the process of subtracting from productive capital over time is called net disinvestment.