what is capital income
Answers
Answer:
Capital income is income generated by an asset over time, rather than from work done using the asset, according to Investopedia. If a farmer buys land for a certain amount of money and sells it at a profit after one year, the difference in the prices is capital income.
Capital income, also known as capital gains, can only be realized after an asset is sold. In contrast, if an asset is sold at a lower price than it was bought for, the result is a capital loss.
Simply, capital income is income that comes from capital, which is to say, comes from wealth itself, rather than any specific production or direct work. Examples are stock dividends or any sort of capital gains, as well as income an owner gets from a business he owns but not from the work he does there.
Step-by-step explanation:
capital income is income generated by an asset over time rather than from work done using the asset ... if a farmer buys land for acertain amount of money and sells it is a profit after one year the difference is prices is capital income