Question

Describe a short description about the factors and process involved in textbook production and the test is your favourite product.​

Answer 1

There are four categories of resources, or factors of production:

Natural resources (land)

Labor  (human capital)

Capital (machinery, factories, equipment)

Entrepreneurship

Natural Resources

Natural resources have two fundamental characteristics: (1) They are found in nature, and (2) they can be used for the production of goods and services. In order to provide benefit, people first have to discover them and then figure out how to use them in the the production of a good or service. Examples of natural resources are land, trees, wind, water, and minerals.

A key feature of natural resources is that people can’t make them. They also tend to be limited. New natural resources—or new ways of extracting them (such as fracking, for example)—can be discovered, though. These natural resources can be renewable, such as forests, or nonrenewable, such as oil or natural gas. It’s also possible to invent new uses for natural resources (using wind to generate electricity, for example). Resources that are cultivated or made with human effort can’t be considered natural resources, which is why crops aren’t natural resources.

Labor

Labor refers to human resources (also called human capital)—physical or intellectual. You’re adding to your own human resources right now by learning. You may possess certain human resources already—perhaps you have an athletic gift that enables you to play professional ball to earn a living, for example—but you can also develop them through job training, education, experience, and so on.

The word labor often calls to mind physical labor—working in a factory or field, constructing a building, waiting tables in a restaurant—but it can refer to any human input (paid or unpaid) involved in the production of a good or service. This broader definition of labor is particularly important in today’s technology-driven business environment, which has come to rely much more on the intellectual contributions of the labor force than the physical labor required of, say, working in a production line. Intellectual contributions include experience in and out of school, training, skills, and natural abilities. In order to remain competitive, businesses place a premium on employees who bring these “soft skills” to the table. Many of the advances in our world today are the result of the application of intellectual human resources.

Finally, labor brings creativity and innovation to businesses. Businesses use human creativity to address changes in consumer preferences and to invent goods and services that consumers haven’t even imagined yet. Without creativity, innovation would stall, and economies would stagnate.