On January 1, 2014, Terry’s Towing Service
owned 4 tow trucks valued at $300,000. During
2014, Terry’s bought 2 new trucks for a total of
$180,000. At the end of 2014, the market value
of all of the firm’s trucks was $400,000. What
was Terry’s gross investment? Calculate Terry’s
depreciation and net investment.
Use the following information to work Problems 13
and 14.
An economy’s capital stock was $46.3 billion at the
end of 2010, $46.6 billion at the end of 2011, and
$47.0 billion at the end of 2012. Depreciation in
2011 was $2.4 billion, and gross investment during
2012 was $2.8 billion (all in 2007 dollars).