In 2-3 sentences, explain the difference between physical capital and human capital. Give 1 example of each.
Physical capital refers to tangible assets such as buildings, machinery, and tools that are used in the production of goods and services. On the other hand, human capital refers to the knowledge, skills, and abilities of an individual that are used to create value. An example of physical capital is a factory, while an example of human capital is an employee's specialized skill set.
Physical capital refers to tangible assets such as machinery, buildings, or equipment that are used in the production of goods or services. For example, a manufacturing company's factory is a form of physical capital.
On the other hand, human capital refers to the knowledge, skills, experience, and abilities that individuals possess and contribute to the production process. An example of human capital is the expertise of a software engineer in developing computer programs.