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Factors of Production

 

The are four factors of production:

 

       

Capital

This refers to all of the tools, buildings , machines et cetera used in the production of goods and the money that firm have and use.

 

       

Enterprise

This is carried out by entrepreneurs who:

 

       

Think of ideas.

 

       

Organise the other three factors of production.

 

       

Take risks with their own money and the financial capital of others.

 

       

Land

Not only the land, but all of the natural resources as well, e.g., gold, oil, fish, wheat.  There are two types of land:

 

       

Non-renewable resources, e.g., oil, gas and copper.

 

       

Renewable resources, e.g., fish, forests and corn.

 

       

Labour

This is the workforce of the economy.  All workers possess different qualities.

 

 

 

 

E-mail Steve Margetts