"Het plein van de hoofdstad is oud."
Translation:The capital's square is old.
In English, it is perfectly acceptable to also say "capital city square" without the using the possessive.
Is there really a distinction between plein and markt ? it is not really clear, De Grote Markt in Haarlem or Antwerpen etc. Het plein in de centrum van Den Haag
I'm not a native and this is just an opinion : Markt = Market, het plein in de centrum van Den Haag = the square in the center of Den Haag... I hope I clarified something.
Since you seem to have trouble looking in a dictionary yourself, here you go, all you have to do is click:
In other words capitol is the building the U.S. Congress meets, or a hill in Rome. Sure in case of the U.S. the capitol happens to be in the capital (Washington, D.C.), but the city is the capital and the building is the capitol.
I guess this means you will have learned something new today. You're welcome!
Here is something else for you to read: http://blog.dictionary.com/capital-vs-capitol/