1.2.3 Factors of production Flashcards
(11 cards)
What are the four factors of production?
Labour, land, capital, entrepreneurship.
What is the role of the entrepreneur in the factor of production?
Takes land, labour and capital and organises them ignorer to produce products.
What reward does the entrepreneur get?
Profit.
What is capital as a factor of production?
The man-made aids that are used in the production process e.g. equipment and premises.
What reward does capital get?
Interest.
What are capital goods?
Will bring a stream of income in the future rather than being consumed today e.g. a car vs a taxi.
What is land as a factor of production?
All the natural resources that come from the earth that are used in the production of goods or services.
What reward does land get?
Rent.
What is labour as a factor of production?
All of the workforce in an economy.
What reward does labour get?
Wages.
What is human capital?
The value of a worker. Can be valued by their income or education and training.
