Question

what are the factors of production needed for production of goods and services? Explain

Answer 1

The factors are :-

Land-It is a fixed and scarce factor of production. It also includes other natural resources such as,water,forest,minerals etc.
Labour-It refers to the people who will do the work.It is an active factor of production as labour makes land and capital productive.
Physical Capital-Itis of 2 types-
Fixed Capital-It refers to the inputs which can be used in prodution over many years.Eg- tools,machines etc.
Working Capital-It refers to the capital that is used up in production.Eg-Money in hand,Raw material etc.
Human Capital-Human capital is the stock of competencies,knowledge, social and personality attributes, including creativity, embodied in the ability to perform labor so as to produce economic value.

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