Explanation:

• Capital goods are physical assets that a company uses in the production process to manufacture products and services that consumers will later use. Capital goods include buildings, machinery, equipment, vehicles, and tools. Capital goods are not finished goods instead; they are used to make finished goods.
• Capital goods are one of the four factors of production. The other three are: Natural resources, such as land, oil, and water; Labor, such as workers; and Entrepreneurship.

Hence option 2nd is correct.