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Question
What is the reward received by an organisation as a factor of production?
What is the reward received by an organisation as a factor of production?
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Solution
The correct option is A Profit
The profit generated by the organisation is the reward received for coordinating and controlling the other three factors of production namely land, labour and capital. Profits are the extra income which is the difference between the capital used to produce a product and the selling amount of the product.
The profit generated by the organisation is the reward received for coordinating and controlling the other three factors of production namely land, labour and capital. Profits are the extra income which is the difference between the capital used to produce a product and the selling amount of the product.
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