Characteristics of capital as a factor of production are :
(i) Capital is a passive factor of production: Capital cannot produce without the help of active services of labour. To produce with machine, labour is required. Thus, labour is an active, whereas capital is a passive factor of production.
(ii) Capital depreciates: As we go on using capital, the value of capital goes on depreciating. When machines are used continuously for some time, these depreciate and their value falls.
(iii) Man produces capital: Capital is that wealth which is used in the production of goods. Capital is the result of human labour. Thus, every type of capital such as road, machines, etc. is produced by man.
(iv) Capital is not an indispensable factor of production: Production can be possible even without capital, whereas, land and labour are the original and indispensable factors of production.
(v) Capital is prospective: Capital is considered much prospective, as the accumulation of capital yield an income.
(vi) Capital is productive: Production can be increased to a large extent if workers work with adequate capital.
