Terms used differently in economics and in finance

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Some terms are used in different ways in economics and in finance.



In finance, capital consists of wealth in the form of money or other assets owned by a person or organization or available or contributed for a particular purpose such as starting a company or investing. In economics, capital goods are resources that are made through the application of labor to land, and that are used to produce consumer goods.


In finance, investment refers to the action or process of investing money for profit or material result. In economics, investment refers to the use of resources to produce capital goods.