UPSC CSE Prelims
Question 43
With reference to physical capital in Indian economy, consider the following pairs:
| Items | Category |
|---|---|
| 1. Farmer's plough | Working capital |
| 2. Computer | Fixed capital |
| 3. Yarn used by the weaver | Fixed capital |
| 4. Petrol | Working capital |
How many of the above pairs are correctly matched ?
View correct answer and explanation
Correct answer: B
Correct Option: B (Only two)
Explanation: Fixed capital consists of durable productive assets such as tools and computers, whereas working capital consists of inputs consumed or circulated during production.
Statement / Pair / Item-wise Analysis:
1. Incorrect/False - A farmer’s plough is durable equipment, hence fixed capital.
2. Correct/True - A computer is durable fixed capital.
3. Incorrect/False - Yarn consumed by weaving is working capital.
4. Correct/True - Petrol used during production is working capital.
Option-wise Analysis:
A. Incorrect-it counts 1, but items 2, 4 qualify, giving 2.
B. Correct-exactly 2 of the 4 listed items satisfy the condition.
C. Incorrect-it counts 3, but only 2 qualify; item(s) 1, 3 do not.
D. Incorrect-it counts 4, but only 2 qualify; item(s) 1, 3 do not.