Factors of production

Need to know

What you need to know

• Factors of production are the resource inputs used to produce goods and services.
• They are categorised as Land, Labour, Capital, and Enterprise.
• The scarcity of these factors is the root cause of the basic economic problem.
• Each factor receives a specific reward or income for its contribution.

Explanation

Factors of production

1. Factors of production are the resource inputs used to produce goods and services.
2. They are categorised as Land, Labour, Capital, and Enterprise.
3. The scarcity of these factors is the root cause of the basic economic problem.
4. Each factor receives a specific reward or income for its contribution.