KN: A labour - intensive business depends more on workers to produce goods and services, while a capital - intensive business relies more on machines and equipment.
APP: E.g a restaurant is labour - intensive because it needs many staff, but a car factory is capital - intensive because it uses machines.
AN: So, labour - intensive firms have higher wage costs, capital - intensive ones spend more on machinery and maintenance.
08 Explain the difference between a labour-intensive and a capital-intensive business.
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Aayan Zaidi
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MuhammadAli91191
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Re: 08 Explain the difference between a labour-intensive and a capital-intensive business.
[KN]Labour-intensive businesses rely more on human workers than machines to produce goods or services whereas Capital-intensive businesses depend more on machinery, equipment.
[APP]A clothing factory in Pakistan is labour-intensive because it relies on many workers to sew garments by hand. In contrast, a car manufacturing company like Toyota is capital-intensive since it uses expensive machines and robots to assemble vehicles.
[AN]Labour-intensive businesses often benefit from lower equipment costs and can create more jobs, which helps reduce unemployment and capital-intensive businesses, on the other hand, can produce goods faster and more efficiently, reducing long-term costs.
[APP]A clothing factory in Pakistan is labour-intensive because it relies on many workers to sew garments by hand. In contrast, a car manufacturing company like Toyota is capital-intensive since it uses expensive machines and robots to assemble vehicles.
[AN]Labour-intensive businesses often benefit from lower equipment costs and can create more jobs, which helps reduce unemployment and capital-intensive businesses, on the other hand, can produce goods faster and more efficiently, reducing long-term costs.