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Question

Fixed capital stands for ______.


A
money with the proprietor
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B
tools, machines, buildings etc. which can be used in production over many years
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C
money deposited in the bank
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D
total share of capital
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Solution

The correct option is B tools, machines, buildings etc. which can be used in production over many years
Fixed capital refers to investment in long-term assets. Management of fixed capital involves the allocation of the firm’s capital to different projects or assets with long-term implications for the business. For example, tools, machines, buildings, etc. which can be used in production over many years. 

Economics

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