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Question
Which of the following types of capital can be used only for a specific purpose?
Options
Floating capital
Money capital
Debt capital
Sunk capital
Solution
Sunk capital
Explanation:
- Sunk capital refers to capital invested in a particular project or asset that cannot be recovered or used for any other purpose. Once this capital is spent, it is "sunk" into that specific use and cannot be redirected elsewhere.
- The other types of capital, such as floating capital, money capital, and debt capital, are more flexible and can be used for various purposes, depending on the needs of the business or project.
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