With reference to physical capital in Indian economy, consider the following pairs

Explanation

1 Farmer’s plough : Working capital This pair is incorrect. A farmer’s plough is considered a fixed capital asset because it is a durable good used in agricultural production over multiple years. It helps in enhancing agricultural productivity but is not classified as working capital, which typically refers to short-term assets like cash, raw materials, and inventory used in day-to-day operations. 2 Computer : Fixed capital This pair is correct. A computer is categorized as fixed capital because it is a long-term asset used in production or business operations over an extended period. It contributes to the production process and is not consumed in a single use. 3 Yarn used by the weaver : Fixed capital This pair is incorrect. Yarn used by a weaver would generally be considered as part of working capital. Working capital includes raw materials and supplies that are consumed or transformed during the production process. Yarn is an input that is used up in weaving and is not a durable asset like machinery or equipment. 4 Petrol : Working capital This pair is correct. Petrol (or fuel in general) is an example of working capital because it is a consumable resource used in day-to-day operations. It is not a durable asset but rather an immediate input required for various activities.