What Is Capital?


Simple Definition:

Capital refers to the money or assets (property, goods, and equipment) that a business or individual owns or invests in. It is the financial resources available to create wealth or generate income.

For example, if a company wants to produce goods, it needs machines, raw materials, and employees; all of these elements require capital investment [investing money into them]. Similarly, an individual may have savings, investments, and real estate properties that provide a source of income. These are his capital.

Very Simple Definition:

Capital means money and things that help make more money.

For example, if you have a piggy bank with money, you can use it to buy something you want. Or, if you have a lemonade stand, your capital could be the lemonade mix, cups, and the money you used to buy them.

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