What is factor of productions?

Answer 1

Factors of production refers to the inputs of the production process.

Factors of productions are resources that produce goods and services.

There are four categories of factors of production:

1. Land: Natural Resources that we use to produce goods and services such as oil, gas and goal, water, etc.
2. Labor: the work time and work effort that people devote to producing goods and services. This includes human capitalwhich is the quality of the labor forming from knowledge and skills of the person obtained from education, on-the-job training and work experience.
3. Capital: the tools, instruments, machine, buildings and other items that are used to produce goods and services. This includes machinery, hammers, etc.
4. Entrepreneurship: the human resource that organizes labor land and capital. This includes the idea, plan, etc about how and what to produce.