Question

State any three differences between labour and capital.

Answer 1

Difference between labour and capital are as follows:

S. No.	Labour	Capital
1.	Labour refers to the physical and mental efforts made by humans during the production process.	Capital refers to the man-made goods utilised in the manufacturing process to produce goods and services.
2.	Labour contributes to production by completing tasks such as operating machines and engaging in other activities necessary to convert input into output.	Capital supplements labour in the production process by providing tools, equipment, and infrastructure that increase productivity and efficiency.
3.	Labour is remunerated through wages, salaries and other forms of compensation.	Capital earns return on investment (ROI) through profit, rent, interest, or dividends.