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Q.

Choose if the given statement is True/False.

Fixed capital is a long-term investment for the business owner.

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a

True

b

False

answer is A.

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Detailed Solution

The above statement is true.
Fixed capital is a long-term investment for the business owner. It is like an asset for businesses. It is the capital that is used for several years in production. It involves machinery, tools, buildings, vehicles, equipment, etc. The firms purchase long-term assets to run businesses; these long-term assets are fixed capital for the firms. These assets are used to make final products. These capitals stay in business permanently except for some depleted with time, such as machinery.

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