Question

(a) Discuss the four main requirements of production.

Answer 1

Answer:

The four requirements of production of goods and services are land, labor, physical capital and human capital. Land is the physical place where all the economic activity takes place. Land plays an important part in production because land itself and the resources on it are usually limited.

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Answer 2

Answer: HOPE IT HELPS

Explanation:

There are four requirements of production of goods and services. These requirements are known as factors of production.

These are :

(i) Land: By land we mean not only the level surface but all gifts of nature which are amenable to human control, such as water, forests, minerals, etc. (ii) Labour: Manpower required to do the work. The mental and physical work done by people in an organisation comes under labour.

(iii) Physical Capital: It means a variety of inputs required at every stage during production.

They can be classified as:

(a) Fixed capital: It includes tools, machines and building that can be used for production for many years.

(b) Working capital: Money in land and raw material that has to be used in current products are included in working capital.

(iv) Enterprise: It means need of knowledge and enterprise to put together all other factors of production and ability to sell the produce in the market.  

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