Question

Machines are called fixed capital _____.

• A. because without machines production is not possible
• B. because it can be used in production for many years
• C. because machines are made by human beings
• D. because machines are not the working capital

Answer 1

The correct option is B because it can be used in production for many years

Fixed capital refers to those producer goods having long life which can be used again and again in productive processes. Their utility does not get exhausted in a single use. Machinery, plants and factory buildings, transport equipments, etc., are some of such components.