FACTORS OF PRODUCTION CHAPTER 2

Question 1

Define factors of production

Answer 1

Economic resources used to produce goods and services that consist land, labour, capital and enterprise.

Question 2

State all four factors of production along with the respective rewards for each factor of production.

Answer 2

Land - Rent
Labour - Wages
Capital - Interest
Enterprise - Profit

Question 3

Define Land

Answer 3

Gifts of nature avalible for production.

Question 4

Define Labour

Answer 4

Anyone who puts mental or physical effort is a labour.

Question 5

Define Capital

Answer 5

Man made goods used for production like machines, tools, equipment etc.

Question 6

Define Enterprise

Answer 6

Enterprise is the ability of taking a risk to start a new firm.

Question 7

Define Consumer goods

Answer 7

Good and services purchased by households for their own satisfaction.

Question 8

Define Occupationally mobile

Answer 8

Ability to change use/Job/job type etc.

Question 9

Define Occupationally immobile

Answer 9

Not having the ability to change use/job/job type etc.

Question 10

Define Geographically mobile

Answer 10

Having the ability to moving from one location to another.

Question 11

Define Geographically immobile

Answer 11

Not having the ability to move from location to location.

Question 12

Define Mobility of labour

Answer 12

Ability of labour to move from location to location and from occupation to occupation.

Question 13

Define Mobility of land

Answer 13

Ability of land to move from location to location and from occupation to occupation.

Question 14

Define Mobility of capital

Answer 14

Ability of capital to move from location to location and from occupation to occupation.

Question 15

Define Mobility of enterprise

Answer 15

Ability of enterprise to move from location to location and from occupation to occupation.

Question 16

Define Entraprenuar

Answer 16

A person who takes the risk of starting a firm and makes key decisions.

Question 17

Define Labour force

Answer 17

People in work or those activly seeking work.

Question 18

Define Productivity

Answer 18

The output of an fop per hour.

Question 19

Define Labour productivity

Answer 19

Output per working hour.

Question 20

Define Output

Answer 20

Goods and services produced by fops.

Question 21

Define Investment

Answer 21

Spending on capital goods.

Question 22

Define Gross Investment

Answer 22

Total investment on capital goods.

Question 23

Define Net Investment

Answer 23

Gross investment - depriciation

Question 24

Define Negative net Investment

Answer 24

Reduction in number of capital goods caused by old worn out capital goods not bieng replaced.

Question 25

Define Depriciation

Answer 25

The value of capital goods that have worn out or become obsolete.