There are two types of capital, one being financial capital , which is the transfer of ownership of assets called stocks and bonds. With financial capital there is no new good produced. When economists discuss the factors of production, land, labor, capital and entrepreneurs, the capital they are referring to is real capital. This is the second type of capital.
Real capital is the production of tools, machines and factories.
When entrepreneurs purchase new machines, tools or factories, they are adding to what is known as the capital stock of the economy. This makes it possible for that economy to now push its production possibilities curve outward to the right. This is known as economic growth. The economy can now have more consumer goods and more capital goods. A. Scarcity in economic terms is a little more complicated.