Physical capital includes

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Fixed capital

Working capital

Natural Resources

Both 1 & 2

answer is D.

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Detailed Solution

Physical capital includes fixed capital and Working capital.
A variety of inputs are required at every stage of production. These form the physical capital needed during production. There are two components of physical capital. They are- Fixed capital and Working capital. Fixed capital includes tools, machinery, land, etc. They involve a considerable sum of money and are the company's tangible assets. Raw materials and cash in hand form the components of working capital. There are various sources from which the funds can be procured and used as a part of the working capital. Moneylenders are a significant source of money. Small and Big farmers borrow money from the moneylenders. Banks also offer loans to farmers.

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