Chapter 2, The Factors Of Production Flashcards
What are the factors of production?
The resources needed to produce goods and services
State the four factors of production.
- Land
- Labor
- Capital
- Entreprise
Complete the following sentence:
The four factors of proaction are __________ in supply
Limited
Why are the four factors of production limited in supply?
As there is never enough land, labor, capital and enterprise to produce all of the needs and the unlimited wants of the population.
Define ‘Land’ and give examples.
The natural resources required in the production process, such as oil, coal, water, wood, metal ores and agricultural products.
Define ‘Labour’ and give examples.
The human resources required in the production process, including skilled and unskilled labour.
Define ‘Capital’ and give examples.
The manufactured resources required in the production process, such as machinery, tools, equipment and vehicles.
Define ‘Enterprise’.
The skills a business person requires to combine and manage the other three factors of production successfully.
Complete the following sentence:
As the factors of production are ____________(1) resources, each has a ____________(2) for its use in the production process
(1) productive
(2) reward
What is the reward for land?
Rent
What is the reward for labor?
Wages and salaries
What is the ward for capital?
Interest
What is the reward for enterprise?
Profit
