Write factors of production and write about working capital
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Factors of production is an economic term that describes the inputs that are used in the production of goods or services in order to make an economic profit. The factors of production include land, labor, capital and entrepreneurship. These production factors are also known as management, machines, materials and labor, and knowledge has recently been talked about as a potential new factor of production.
Working capital is calculated as current assets minus current liabilities. If current assets are less than current liabilities, an entity has a working capital deficiency, also called a working capital deficit. ... The management of working capital involves managing inventories, accounts receivable and payable, and cash
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Working capital is calculated as current assets minus current liabilities. If current assets are less than current liabilities, an entity has a working capital deficiency, also called a working capital deficit. ... The management of working capital involves managing inventories, accounts receivable and payable, and cash
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Answer:The term capital is used in economics in various senses. In ordinary language and sometimes in economics also capital is used in the sense of money.
But when we talk of capital as a factor of production, to confuse capital with money is quite wrong. Of course, money is used to purchase various factors such as raw materials, machinery, labour which help to produce goods, but money itself does not directly help in the production of goods.
Explanation:
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