Question

What are the factors of production?

• A. Land, labour, capital, organisation
• B. Land, electricity, water, labour
• C. Labour, capital, land, rainfall
• D. Labour, climate, land, tools

Answer 1

Answer: (A)

Land, labour, capital, organisation

In modern economics, there are four factors of production-

1) Land-It is a natural resource which provides raw materials.

2) Labour-It refers to the human efforts used to produce goods and services..

3) Capital-It refers to the wealth necessity to run a smooth production function.

4) Organization or entrepreneurship-It refers to the skill required to set up the firms in an economy.