International General Certificate of Secondary Education (IGCSE) Business Studies Practice Exam

The best definition of 'Capital' in a business context is the combination of finance and machinery. Capital refers to the resources that a business uses to generate income and is typically divided into two main types: financial capital, which includes money and funding necessary for operations, and physical capital, which encompasses the machinery, equipment, and facilities required for production. Together, these resources enable a business to produce goods and services and operate efficiently.

The other options provided refer to different business concepts. The process of adding value to a product describes value-added activities rather than capital itself. A person who takes risks in business refers to an entrepreneur, a separate concept focused on individual roles and characteristics in business ventures. Finally, the act of selling to customers is related to sales and marketing rather than capital. Therefore, focusing on the combination of finance and machinery effectively captures the essence of capital in business studies.