Introduction

Indian Economic System(RAS)

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Indian Economy - Understanding the basics of Indian economic system

With reference to physical capital in Indian economy, consider the following pairs:

In how many of the above rows is the given information correctly matched?

This questions was previously asked in

UPSC CSP GS Previous Year Paper 2024

Only one

Only two

Only three

All four

All four.

Working capital refers to the funds or resources that a business uses for its day-to-day operations, including the purchase of raw materials like yarn, payment of wages, and other operational expenses.
While a plough is necessary for production, working capital refers to items that are consumed in the production process. A plough is a durable item that can be used for many production cycles. Therefore, it is classified as fixed capital.
Fixed capital refers to physical assets that are used in the production process for a relatively long period. A computer is a durable item that is used in the production of goods or services for several years.
Yarn used by the weaver can be considered as working capital.