Question

Explain land and labour as the factors of production with their rewards.

Answer 1

Instructions:
Explain the factors of production

• Land
• Labour

Solution:
Land as the factor of production:
Land as a factor of production includes all fixed natural resources like soil, water, air, forest ,coal and so on that are available on land. The land indirectly includes all these factors required to set up a factory. Therefore, we can build a factory only if these resources are sufficient enough.
Features of land:

• A factory can be built on land and this land includes various natural features like air, water, soil etc.
• It is not possible to increase the size of the land
• It is not possible to shift the land from one place to another.
• The fertility of every land depends on its use.

Reward for land : for land, we get rent as the reward.

Labour as a factor of production:
The next factor of production that we are going to learn is the labourers or the workers involved in the process of production.
In any factory, it is necessary to have the labourers to operate the machinery and manufacture products. These workers use their physical and intellectual skills to make goods.

People in the choir industry actually make coconut fibres suitable for choir manufacturing, operate the machinery and distribute products. In this factory, people use their physical skills to work there. Whereas in a software company , the workers use their intellectual skills to create computer programmes.

Rewards:
The labour gets wages for the work they do. Wages are therefore mostly paid in cash. But these can also be rewarded in the form of goods in return. For example, coconuts are given as rewards to labourers for plucking them.

Features of labour:

• Labourers operate the machinery and manufacture products.
• They distribute the products manufactured in the factory. And they use their skills to produce the goods and services.