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JAMB Economics 1987 Question 11

Question 11

Theory of Production

The form of capital which is usually consumed or transformed into finished goods and services in the production process is called

  1. A.industrial capital
  2. B.social capital
  3. C.fixed capital
  4. D.circulating capital.
Show the answer and explanation

Answer: D (circulating capital.)

Explanation

Circulating (working) capital, such as raw materials, is used up in one round of production; fixed capital like machines is used again and again.