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JAMB Economics 1987 Question 46

Question 46

National Income

Capital consumption allowance refers to

  1. A.personal consumption expenditure
  2. B.indirect business taxes
  3. C.depreciation of capital equipment
  4. D.expenditure on capital equipment.
Show the answer and explanation

Answer: C (depreciation of capital equipment)

Explanation

Capital consumption allowance is the value of capital worn out in production, i.e. depreciation.