Which industry is typically capital-intensive?

• A. Airplane manufacturing
• B. Wheat farming
• C. Hairdressing
• D. Textile weaving

Answer: (A)

Capital intensity is about how much fixed capital a production process requires relative to output. Airplane manufacturing involves enormous upfront investments: massive factories, highly specialized tooling and machinery, long development and production cycles, rigorous safety testing and certification, and a complex supplier network. All these fixed costs must be absorbed before any product is delivered, so the industry relies heavily on large capital outlays to produce at scale. That combination—huge upfront capital with long lead times—makes it quintessentially capital-intensive.

Wheat farming, while requiring equipment and land, generally relies more on natural inputs and labor and can scale with comparatively lower fixed investment per unit of output. Hairdressing needs only basic shop equipment and space, which is far lighter on fixed capital. Textile weaving uses machinery too, but the overall scale of required fixed investment is typically not as extreme as in aircraft manufacturing.