What are the factors of production? What are the two types of capital?
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Answers
Capital differs based on the worker and the type of work being done. ... The income earned by owners of capital resources is interest. The fourth factor of production is entrepreneurship. An entrepreneur is a person who combines the other factors of production - land, labor, and capital - to earn a profit.
Explanation:
More specifically, capital can be the money that companies use to buy resources, as well as the physical assets companies use when producing goods or services, such as factories and machinery. Capital is an important factor of production because it's what allows labor and land to be purchased.
When economists refer to capital, they are referring to the assets–physical tools, plants, and equipment–that allow for increased work productivity. Capital comprises one of the four major factors of production, the others being land, labor, and entrepreneurship.