Capital Definition by Marshall Hargrave

Title: Capital Definition

Author: Marshall Hargrave

TLDR: Capital is the financial assets that a firm holds, these can include funds in accounts or from financing.

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Topic Tags: Capital, Equity, Finance, Debt, Valuation

Questions Answered:

What is capital?What is capital used for?

What are different types of capital?

Summary:

  • Capital is a term for financial assets, such as funds held in deposit accounts and funds obtained from special financing sources.
  • Financing capital usually comes with a cost.
  • The four major types of capital include debt, equity, trading, and working capital.
  • Companies must decide which types of capital financing to use as parts of their capital structure.

Follow Up Questions:

What are the different types of capital financing?

What’s the difference between capital and money?