Capital Resources | Derived demand | Entrepreneur | Factors of Production | Human Resources | Interest | Interest-reward for capital resources | Natural Resources | Non-Renewable Resources | Profit | Profit-reward for entrepreneurship | Renewable Resources | Rent | Rent-reward for natural resources | Resources | Wages | Wages-reward for human resources
The economic term for individuals who take risks and organise the factors of production e.g. owner of a factory is?
Define the term factors of production.
Factors of production (or resources) are the economic inputs used by producers in the production process. Resources can be classified as natural resources, capital goods, human resources and entrepreneurship.
Some individuals would argue that cows are a natural resource while others would argue that with modern farming methods, cows should be classified as a capital resource. Explain both positions.
Cows are a natural resource: because cows occur in nature and are not man-made. Cows are a capital resource: because of selective breeding / GE / GM / cloning, they are man-made and do not occur in nature.
Which of these resources are limited (finite)? (i) Natural resources (ii) Capital resources (iii) Human resources and entrepreneurship
(i), (ii) and (iii). The factors of production (resources) are all limited or finite, relative to the unlimited desires (wants) of society.
Fast food outlets use many resources while providing the food service for customers. Identify one example of capital resource used by a fast food outlet.
Pie warmer, cooking equipment, counter, till, EFTPOS machine, freezer, oven.
_________ are man-made goods used to produce other goods and services.
Capital goods. Capital resources are man-made aids used to produce other goods and services, eg, machinery, tools, buildings, roads, etc.
_________ are individuals willing to organise the factors of production to produce a good or service and take risks.
Entrepreneurs. Entrepreneurs are individuals willing to organise factors of production to produce a good or provide a service and take risks.