Which of the following is NOT a part of the inventory investment calculation in National Income?

Correct Answer: Change in sales during the year

Subject: economics

• Change in stock of raw materials
• Change in stock of finished goods
• Change in sales during the year
• Change in stock of semi-finished goods

Explanation: • <b>Key Fact</b> Change in sales is NOT included in inventory investment. • <b>Supporting Detail</b> Inventory investment strictly refers to the change in the physical stock of unsold finished goods, semi-finished goods, and raw materials. • <b>Related Concept</b> Inventories carried from one year to the next are treated as capital/investment. • <b>Why wrong options are wrong</b> Sales represent final consumption/expenditure, not the unsold stock (inventory) held by firms. • <b>Exam Trick</b> Inventory = Stock (Unsold stuff in the godown). Sales = Already sold (left the godown). • <b>Additional Info</b> Inventory investment is a component added to fixed investment to get total Gross Investment.

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