Define the factor of production called capital. Give three examples of capital, different from those in the chapter. Distinguish between the factor of production capital and financial capital

What will be an ideal response?

Capital is the tools, instruments, machines, buildings, and other items that have been produced in the past and that businesses now use to produce goods and services. Capital includes railroad engines and cars, servers, and ATMs. The factor of production "capital" is the actual good itself; "financial capital," such as stocks and bonds, are the funds that provide businesses with their financial resources which can be used to ac-quire capital goods.

Economics

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The fact that a firm is using a capital-intensive method of production means that input substitution is not possible

Indicate whether the statement is true or false

Economics

Baumol and Blinder offer some reasons why countries trade with each other. List three of the reasons, and give an example of each to illustrate the reason

Economics