With reference to physical capital in Indian economy, consider the following pairs: 1. Farmer's plough - Working capital 2. Computer - Fixed capital 3. Yarn used by the weaver - Fixed capital 4. Petrol - Working capital How many of the above pairs are cor

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Q: 7 (IAS/2024)
With reference to physical capital in Indian economy, consider the following pairs:
1. Farmer's plough - Working capital
2. Computer - Fixed capital
3. Yarn used by the weaver - Fixed capital
4. Petrol - Working capital
How many of the above pairs are correctly matched?

question_subject: 

Economics

question_exam: 

IAS

Fixed capital refers to physical assets like machinery or installations which can be used repeatedly. The computer is fixed capital. Yarn, which is used in the process and not reused, is not fixed capital. Petrol is consumed immediately, thus, working capital. Only the computer is correctly matched as fixed capital.