Question

how covid 19 affects capital factor in factor of production in economy?

Answer 1

Covid -19 have bad impact in economy at all over world.We are facing great recession.There is no production activity.We are facing lockdown almost countries.There is no demand for capital because people does not have enough money to spend in huge investment .as capital investment is a huge investment it requries big amount for investment.When we invest money in capital then big amount of money wil be blocked for future.There is no more job opportunity arises.work from home concept is arises hence there is no production activities in a factory.So due to covid -19 capital is affected badly.Capital is one of the factor production which is used for running production smoothly and efficiently.But as we know that there is great recession all over world.companies are throwing out employess from job.Companies does not have enough money for funding .Hence demand for these goods is decreasing.