1. What is fixed capital and working capital in rural sector? Name such assets used in Palampur.
Answers
Answer:Fixed capital In rural area is that capital in which some money has been invested like- machinery, land, building. And it is also a source of passive income.
On the other operating capital in rural area is that which is used day to day for the trading process.
Example- cash, borrowing
Assets used in Palampur are machinery, building, capital etc.
Tools and machines range from very simple tools such as a farmer's plough to sophisticated machine such as generators, turbines, computer,etc. Tools, machines, buildings can be used in production over many years and are called fixed capital .
Production requires a variety of raw materials such as the yarn used by the weaver and the clay used by the potter. Also, some money is always required during production to make payments and to buy other necessary items. Raw materials and money in hand are called working capital.