Working Paper No. 03-07 (2024)

FAQs

What are the 5 capital assets in a community? ›

It is useful to differentiate between five kinds of capital: financial, natural, produced, human, and social.

Physical capital is the variety of inputs required at every stage during production. It includes fixed capital and working capital. The tools, machines, buildings which can be used in production over many years are called fixed capital. Raw materials and money in hand are called working capital.

Economic or financial capital entails monetary funds and investments like equity, debt, or real estate. Human capital and social capital augment the purely economic rationale behind capital and together better explain how business and economic growth really work.

Knowledge capital is unlike different physical factors of production, such as land, labor, and capital. That's because it is based on the skills that employees share with each other to improve efficiencies rather than physical items.

Capital assets are significant pieces of property such as homes, cars, investment properties, stocks, bonds, and even collectibles or art. For businesses, a capital asset is an asset with a useful life longer than a year that is not intended for sale in the regular course of the business's operation.

Cash, including money in bank accounts and undeposited checks from customers. Marketable securities, such as U.S. Treasury bills and money market funds. Short-term investments a company intends to sell within one year. Accounts receivable, minus any allowances for accounts that are unlikely to be paid.

Working capital is the amount of current assets that's left over after subtracting current liabilities. It's what can quickly be converted to cash to pay short-term debts. Working capital can be a barometer for a company's short-term liquidity. A positive amount of working capital indicates good short-term health.

The four major types of capital include working capital, debt, equity, and trading capital. Trading capital is used by brokerages and other financial institutions.

What are two social capital examples? ›

What Is an Example of Social Capital? Social capital allows one to leverage information or resources among one's social connections. Asking a friend to borrow their car in a pinch, or finding out about a job opportunity from an old college classmate are both examples of social capital.

Sometimes called simply "capital," this factor includes human-made items or products that make the manufacturing process possible or enable it to run smoothly.

Physical capital refers to assets, such as building, machinery, and vehicles, which are owned and employed by an organisation. Physical capital constitutes one of the factors of production other than land and labour. The assets constitute fixed capital means that they are not consumed in the process of production.

Physical capital, as a subset, refers to the durable non-financial assets used in the process of producing goods and services. It is also known as real capital, capital stock, or capital assets. Examples of physical capital include machinery, tools, buildings, inventory, and so on.

Built assets refer to anything physically made by humans, include housing, factories, schools, roads, community centers, power systems, water and sewer systems, telecommunications infrastructure, recreation facilities, transportation systems, etc.

The capital assets of an individual or a business may include real estate, cars, investments (long or short-term), and other valuable possessions. A business may also have capital assets including expensive machinery, inventory, warehouse space, office equipment, and patents held by the company.

Examples of capital assets are buildings, computer equipment, machinery, and vehicles. In asset-intensive industries, companies tend to invest a large part of their funds in capital assets. A capital asset has the following characteristics: It has an expected useful life of more than one year.

Community-Managed assets or organizations are those that are owned and controlled through some representative mechanisms that allow a community to influence their operation or use and to enjoy the benefits arising.