Answer
An economy that has rising stock capital has negative net investment because their gross investment is increasing but their depreciation is decreasing. AN economy that has falling stock of capital has lower gross investment but higher depreciation. Gross investment cannot be less than zero because an economy will always be spending money on capital to produce output.
Work Step by Step
An economy that has rising stock capital has negative net investment because their gross investment is increasing but their depreciation is decreasing. AN economy that has falling stock of capital has lower gross investment but higher depreciation. Gross investment cannot be less than zero because an economy will always be spending money on capital to produce output.
