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Q.

Money in hand is required for making :

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a

Daily payments for the production operations

b

Working Capital

c

Human Capital

d

None of these

answer is A.

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Detailed Solution

Money in hand is required for making daily payments for production operations, which is why it is called working capital. Capital is an essential factor in production. It is of two types: working capital and fixed capital. Working capital includes resources required on a day-to-day basis during the process of production. This consists of the raw materials, wages for the labour, bills for the other amenities like water and electricity, and money in hand to pay these and many other bills. These types of resources are required daily, weekly, or monthly.

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