Differentiate between fixed and working capital requirements.
(tabular differentiation)
| Fixed capital | Working capital |
| Fixed capital is required for a longer time period | Working capital is required for a shorter time period. |
| This is required to purchase assets that will remain permanently in the business | Working capital is required for day-to day activities of business |
| For instance, capital requirement for the purchase of machinery, tools, etc. | For instance capital requirement for the purchase of raw material |