Question

Distinguish Between working and fixed capital.Give example​

Answer 1

Answer:

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Answer 2

Answer:

   Fixed capital supports the business indirectly. Working capital supports the business directly.

   Fixed capital is invested in long-term assets. Working capital is invested in current assets.

   Fixed capital is required before the business starts. Working capital is required after the business gets started.

   Fixed capital can’t be liquidated into cash immediately. Working capital can be liquidated into cash immediately.

   Fixed capital serves the business for a very long period of time. Working capital serves the business for a very short period of time.

   The orientation of fixed capital is strategic. The orientation of working capital is operational.

Explanation: