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==Definition== [[Gregory Mankiw|N.G. Mankiw]] definition from the book Economics: ''[[Capital (economics)|Capital]] is the equipment and structures used to produce goods and services. Physical capital consists of man-made goods (or input into the process of production) that assist in the production process. Cash, real estate, equipment, and inventory are examples of physical capital.''<ref>MANKIW, Gregory N., TAYLOR, Mark P., Economics, 2015,03,P. 2, {{ISBN|978-1-4080-9379-5}}</ref> Capital goods represents one of the key factors of [[corporation]] function. Generally, capital allows a [[company]] to preserve [[accounting liquidity|liquidity]] while growing operations, it refers to physical [[assets]] in [[business]] and the way a company have reached their physical capital. While referring how companies have obtained their capital it is important to consider both - physical capital and [[human capital]].<ref name="humancapital">{{Cite web|url=https://www.investopedia.com/ask/answers/062616/human-capital-vs-physical-capital-what-difference.asp|title=Human Capital vs. Physical Capital: What's the Difference?}}</ref> Based on economic theory, physical capital represents one of the three primary factors of production, that is also recognized as inputs production function. The others are natural resources (including land), and labour. The word "Physical" is used to distinguish physical capital from human capital and financial capital. "Physical capital" denote to fixed capital, all other sorts of real physical asset that are not included in the production of a product is distinguished from circulating capital. <ref>{{Cite web|url=https://www.investopedia.com/terms/p/physical-capital.asp|title = Physical Capital Definition}}</ref>
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