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What are the four factors of production?
1. Land – Natural resources like coal, water, and real estate.
2. Labour – Human workforce (employees).
3. Capital – Machinery, buildings, and raw materials.
4. Enterprise – Management skills and risk-taking.
What is capital in economics?
Capital refers to physical goods used in production, such as machinery, factories, and raw materials.
What are the two types of capital?
• Fixed capital – Long-term assets like machines and buildings.
• Working capital – Raw materials and semi-finished goods used in production.
What is the reward or incentive for capital?
Interest from investment.
What is entrepreneurship in economics?
Entrepreneurship refers to managerial ability, risk-taking, and innovation to combine factors of production.
What is the reward or incentive for entrepreneurship?
Profit, which encourages risk-taking and innovation.
What does land include as a factor of production?
Natural resources such as oil, coal, water, and agricultural land. It also includes physical space for buildings.
What is the reward or incentive for land?
Rent for using land resources.
What is labour in economics?
Labour refers to human capital, which is the workforce that contributes to production.
What is the reward or incentive for labour?
Wages paid to workers for their services.
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