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Many objects have both kinetic and potential energy.
For example, an airplane in flight has kinetic energy due to its movement, and potential energy because of its mass and distance from the Earth.
The combination of potential and kinetic energy creates this form of energy.
What is mechanical?
Mechanical Energy exists in a closed system.
Mechanical Energy = Potential Energy + Kinetic Energy
Only friction can drain energy from this system. In the presence of friction, mechanical energy is converted into thermal energy.