Capital and Organization
Capital is a man-made means of production which is used in a further production of goods and services. It is taken as a stock of financial assets which can be used to provide an income.Capital is the man-made factor of production.
Summary
Capital is a man-made means of production which is used in a further production of goods and services. It is taken as a stock of financial assets which can be used to provide an income.Capital is the man-made factor of production.
Things to Remember
- Capital is a man-made means of production which is used in a further production of goods and services.
- Capital formation means the increase in the stock of real capital in the country.
- Organization is also a factor of production like land, labour, and capital.
- The process of capital formation entirely depends on how to save more and how to utilize them in best ways.
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Subjective Questions
Q1:
What do you mean by copying mechanism and strategies to cope with stress ?
Type: Short Difficulty: Easy
<p>The coping mechanism is an adaptation to environmental stress that is based on conscious or unconscious choice and that enhances control over behaviour or given psychological comfort. In coping with stress, people tend to use one of the three main coping strategies.</p>
<ul>
<li>Appraisal-focused strategies</li>
</ul>
<p>Distance oneself from a problem.</p>
<p> </p>
<ul>
<li>Problem-focused strategies</li>
</ul>
<p>Try to deal with the cause of their problem.</p>
<p> </p>
<ul>
<li>Emotional focused strategies</li>
</ul>
<p>A few example of behavioural emotional focuses coping could be listening to music, message, meditation, getting physical exercise, going out with a friend, writing in a journal or diary, taking a hot bath, expressing your emotions creatively (painting).</p>
Q2:
Write the rights of pediatric medication ?
Type: Short Difficulty: Easy
<ul>
<li>Right medication</li>
<li>Check name and expiry date</li>
<li>Know action and side effects of medicine</li>
</ul>
<p> </p>
<ul>
<li>Right patient</li>
<li>Check identification by asking name to parent or child</li>
<li>Confirm identity each time</li>
</ul>
<p> </p>
<ul>
<li>Right time</li>
<li>Give 20-30 minutes around ordered time</li>
<li>Know when it was last given</li>
</ul>
<p> </p>
<ul>
<li>Right route</li>
<li>Check ordered route and ensure this is the most effective and safe route</li>
<li>Clarify if there is any confusion</li>
<li>Administer drug by the ordered route</li>
</ul>
<p> </p>
<ul>
<li>Right dose recommended</li>
<li>Calculate recommended dose and check it</li>
<li>Question the prescriber if the ordered dose is outside the recommended dose range</li>
</ul>
<p> </p>
<ul>
<li>Right documentation</li>
<li>Record administration of the medication on appropriate document as per hospital policy</li>
<li>Ensure record of all medication</li>
<li>Document what, when, how she/he received</li>
</ul>
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Capital and Organization
Organization
Organization is also one of the factors of production like land, labour, and capital. Organization is the process of bringing together physical, financial and human resources and establishing productive relations among them for the achievement of specific objectives. Business organizations have to use land, labour, capital, etc for the production and it pays rent, interest, wages, etc in return from the factors of production. Therefore, the task of allocating the others factors of production is also known as the organization.
According to L.A. Allen, "Organization is the process of identifying and grouping the work to be done, defining and delegating responsibility and authority and establishing the relationship for the purpose of enabling t work most efficiently to obtain the objectives."
FORMS OF BUSINESS ORGANIZATION
There are various types of business organization. Sole proprietorship, Partnership, Joint Stock Company, Co-operatives, Multinationals, etc. are the main types.
CAPITAL
Capital is a man-made means of production which is used in a further production of goods and services. It is taken as a stock of financial assets which can be used to provide an income.
According to prof. Fisher, “Capital is that property which is the production of past labour but which is used as a means of further production.”
According to Marshall, “Capital consists of those kinds of wealth other than the free gifts of nature, which yield incomes.”
CHARACTERISTICS OF CAPITAL
- Capital is a man-made factor: Capital is the man-made factor of production. It is not naturally invented but it is created by man with the help of means of production such as vehicles, plants, tools, furniture, etc. which helps to produce both the agricultural and industrial goods and services.
- Capital is a mobile factor: Capital is one of the most mobile factors which can be transferred from one and place to another place easily because it holds the quality divisibility, durability, and portability.
- Capital is the passive factor of production: Capital is a passive factor of production. It is produced by human beings which cannot be produced by itself. It remains unproductive, unless there is involvement of labour, a machine does not give production.
- Capital is depreciable: It is not permanent . Capital is likely to depreciate after its purchase or use. The wear and tear cost is one of the parts of depreciation. The value of machinery items diminishes every year. So, capital is depreciable.
- It depends on upon technology: The amount of capital depends upon the level of technology employed by a nation. The more progress is in a country’s technology, the more capital is produced in that nation.
CAPITAL FORMATION
Capital formation means the increase in the stock of real capital in the country. This concept was introduced by Prof. Ragnar Nurkse. According to him, “A society doesn’t spend all income to meet present needs. It saves some parts of its income. Such savings are collected by banks and financial institutions and they provide it to the business sector in the form of loan for further production purpose.”
Economic development depends on capital formation.
PROCESS OF CAPITAL FORMATION OF BUSINESS
The process of capital formation entirely depends on how to save more moey and how to utilize them in best ways. The objective of saving and investment is to formulate more capital, more employment opportunities, increasing per capita income and national income to meet the goal of economic development of a nation.
- Creation of savings: The first stage of a capital formation is a creation of savings or increase in a volume of savings. Saving is the portion of income left after consumption. The saving capital of an individual, household, and society is based on following:
a. Ability to save: The income level of the people or nation determines the power to save if their unnecessary consumption is controlled by themselves. Therefore, higher the income, higher will be the capacity to save and lower the income, lower will be the saving capacity.
b. Willingness to save: It is determined by several factors. Some major factors are social status, culture, tradition, consumption habits ,government policy, a position of law and order, security of life and wealth ,existing banking facility, etc. which helps to increase the rate of capital formation. On the contrary, if their willingness to save decrease, it reduces the rate of capital formation.
c. Government Saving: Budget surplus, expenses of government, export promotion, etc. determines the saving capacity of a public and individual as well.
- Mobilization of savings: It is the next step in the process of capital formation. The saving of the people must be mobilized and transferred to business or entrepreneurs who require them for investment. If saving is idle, it will not be helpful to capital formation.
- Investment of savings: An economy requires numbers of business organizations in the fields of agriculture, manufacturing industries, education, health , transport, communication, banking, foreign trade, tourism. etc. to create opportunities for the investment and greater the investment greater will be the motivation of savings and vice-versa.
(Karna, Khanal and Chaulagain)(Khanal, Khatiwada and Thapa)(Jha, Bhusal and Bista)
Bibliography
Jha, P.K., et al. Economics II. Kalimati, Kathmandu: Dreamland Publication, 2011.
Karna, Dr.Surendra Labh, Bhawani Prasad Khanal and Neelam Prasad Chaulagain. Economics. Kathmandu: Jupiter Publisher and Distributors Pvt. Ltd, 2070.
Khanal, Dr. Rajesh Keshar, et al. Economics II. Kathmandu: Januka Publication Pvt. Ltd., 2013.
Lesson
Factors of Production
Subject
Economics
Grade
Grade 12
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