2.3 Flashcards

(3 cards)

1
Q

Explain land as a factor of production [3]

A
  • Means the space where production can be located
  • Also refers to the natural resources that are inputs into the production process
  • This could include wind, water, solar and oil
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2
Q

Explain labour as a factor of production [3]

A
  • Means human effort contributing to production wages and salary earned in return
  • Many businesses see workers as their biggest cost
  • Managers and employees are usually grouped together
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3
Q

Explain capital as a factor of production [3]

A
  • Includes premises and equipment that are repeatedly used in production
  • For example, a chef’s pots and pans are capital, ingredients are raw materials
  • Building bigger stocks of capital increases income and wealth
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