Capital can be differentiated between physical capital and human capital.

Human capital is:
A. the new developments in machinery and software.
B. the knowledge and skills workers acquire from education and training or from their life experiences.
C. the goods manufactured to produce other goods and services.
D. the energy used to bring together the factors of production to produce goods and services.

Which of the following is the best example of human capital?
A. A manager devotes more spending to research and development.
B. A worker pays less in taxes.
C. A worker gets a college degree.
D. A manager buys workers more personal computers.

Human capital refers to the skills, knowledge, and experiences that contribute to a worker's productivity. The best example of human capital from the given options is a worker getting a college degree, as it increases their level of education and skill.

Explanation:

Capital can be categorized into physical capital and human capital. Physical capital consists of tangible assets such as machinery, buildings, and infrastructure that are used in the production process to generate goods and services. In contrast, human capital is defined by the accumulation of skills, knowledge, and experiences that a worker possesses, which enhances their productivity and efficiency. For instance, when students attend college, they are effectively investing in their human capital by acquiring education that will make them more productive and potentially lead to higher earnings in the future.

The best example of human capital among the options provided would be C. a worker gets a college degree. This is because completing a college education directly contributes to a worker's skill set, knowledge base, and credentials, all of which are integral components of human capital.