This index is based on the net investor price, which is the figure that a company has to spend on an investment plan (acquisition of machinery, equipment, etc.) after deduction of the terms and conditions- of transport to the agreed destination within the industry, plus any costs for transfer to the site, installation costs, etc., in other words the “actual purchase price” (cost price without VAT).
The capital goods price index has been an essential tool for National Accounts since the early 1980s for deflating gross fixed capital formation.
The results of the price index for capital investments have the following specified uses:
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