What are the examples of the expenses which raise productive capacity?

Financial expenditure

The correct answer is Option 3: Financial expenditure

Investment expenditure refers to spending on capital goods such as machinery, equipment, factories, and technology, which enhances the productive capacity of an economy. These investments contribute to long-term economic growth by increasing the economy's ability to produce goods and services efficiently.

Here's why the other options are not examples of expenses that raise productive capacity:

• Consumption expenditure: Consumption expenditure refers to spending on goods and services for immediate consumption by households or individuals. While consumption is essential for economic activity, it does not directly contribute to raising the productive capacity of the economy.

• Financial expenditure: This refers to expenses related to managing finances, such as interest payments or loan fees. These don't directly increase production capacity.

• Revenue expenditure: Revenue expenditure includes routine operating expenses such as salaries, utilities, and maintenance costs. While necessary for the day-to-day functioning of businesses and governments, revenue expenditure does not directly contribute to increasing the productive capacity of the economy.