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Capital

1) Which of the following are capital and which are not. Explain

a) video poker game machine at a local bar that takes quarters.

b) a $10 bill

c) A college education

d) The Golden Gate Bridge.

e) The shirts on the rack at Sears.

f) A government bond.

g) The Empire State Buliding.

h) A savings account

i) The Washington Monument

j) A Honda plant in Marysville, Ohio

2. True or False and Explain

a) Savings and investment are juse two words for the same thing

b) When I buy a share of Microsoft stock I have invested; when I buy a government bond I have not.

c) Higher interest rates lead to more investments because those investments pay a higher return.

Solution Preview

Capital is Financial assets or the financial value of assets such as cash, the factories,

machinery, and equipment owned by a business.
In general, it refers to financial resources available for use.

1) Which of the following ar capital and which are not. Explain
a) video poker game machine at a local bar that takes quarters.
It is capital. It is a machinery owned by the bar owner and can be used for production.

b) a $10 bill
If it is invested in a corporation, it is capital. Otherwise, it is not.

c) A college education
Education cannot be measured in money term, so it is not capital.

d) The Golden Gate Bridge.
Since the bridge is ...

Solution Summary

Capital is evaulated.

$2.19