What is the definition of 'capital' in a business context?

In a business context, 'capital' refers specifically to financial assets or resources that can be utilized for the purpose of production. This encompasses various forms of money and assets that a business can invest in activities to generate goods or services. Capital can include cash, equipment, facilities, and investments, all of which are critical for the operational capacity and growth of a business. Effectively, capital is the foundation for a company’s ability to produce and generate revenue, reflecting both the financial capability and operational resources available.

In contrast, the other options focus on distinct elements of business operations. Physical inventory pertains specifically to the goods a company holds for resale, total revenue is the overall income from business activities before any expenses are subtracted, and human resources refer to the workforce employed by the company. While these are all important aspects of running a business, they do not encompass the broader financial resources that define capital.