ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Livestock as capital investment Livestock are capital assets (see Box 1). The family flock or herd is a capital stock, or endowment, resulting from past productive activity, which will increase household income above that derived from the inputs of land and labour.

Detailed explanation-2: -Capital goods are the physical things a company uses to create finished products. Tools, vehicles, and machines can all be capital goods. Some examples are: A bulldozer or dump truck that’s used in construction projects.

Detailed explanation-3: -Some people describe capital finance as the fifth factor of production, but it’s not actually a factor of production. Rather, it helps to make production possible as the owners of production receive income.

Detailed explanation-4: -As a factor of production, capital refers to the purchase of goods made with money in production. For example, a tractor purchased for farming is capital. Along the same lines, desks and chairs used in an office are also capital.