Financial Capital
Definition
Financial Capital refers to funds available for investment in financial assets such as stocks, bonds, or bank accounts. It represents money that can be used to generate income or wealth through various investment opportunities.
Analogy
Imagine financial capital as seeds that you can plant in different investment options. Just like seeds grow into plants and bear fruits, financial capital can grow through investments and generate returns.
Related terms
Physical Capital: Tangible assets such as machinery, buildings, or equipment used in production.
Human Capital: The skills, knowledge, and experience possessed by individuals that contribute to their productivity and earning potential.
Capital Markets: Financial markets where long-term debt or equity securities are bought and sold.
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