Question

Which of the following is not fixed capital?
A. Agricultural Land
B. Tube Well
C. Fertilisers and pesticides
D. None of the above

Answer 1

Hint: Capital in economics refers to human-created assets that can improve one's ability to perform economically useful work. A stone arrowhead, for example, is capital for a hunter-gatherer who can use it as a hunting instrument; similarly, roads are capital for city dwellers.

Complete answer:
Fixed capital refers to the assets and capital investments required to start and run a business, such as property, plant, and equipment (PP&E).
Option A: Agricultural Land: Farmers require a large amount of capital to carry out farming activities. They require funds to purchase seeds, fertilizers, pesticides, and farming equipment. Farmers also require funds to irrigate their land. Farmers on a medium and large scale have their capital (money) to invest in farming activities.

Option B: Tube Well: tube-well farms, reflecting the timeliness and availability of water inadequate. duration adequately the timing of benefits and costs, this exercise relies on. assumed a 12% rate to represent the opportunity cost of capital.

Option C: Fertilisers and pesticides: Chemicals are found in fertilizers and pesticides. Excess amounts of these chemicals in the soil are toxic to microorganisms like bacteria, causing death and fertility loss. As a result, it is not fixed capital.

Thus, the answer is Option C: Fertilisers and pesticides.

Note: David Ricardo, a political economist, was the first to introduce the concept of fixed capital in the 18th century. Ricardo defined fixed capital as any type of physical asset that is not consumed in the production of a product. This was in contrast to Ricardo's concept of circulating capital, which included raw materials, operating expenses, and labor. Fixed capital is closely related to the concept of constant capital.