FACTORS OF PRODUCTION Archives

Meaning of factors of Productions For the activities of production to take place, factors must be available.These are the things that make the production of goods and services possible; hence they are called factors or agents of production. They are; Land Labour Capital and Enterpreneur These factors supply the money, physical effort, land or place of business and managerial expertise (i.emanagement ability) to enable the making of goods and supply of services possible. Land Does not only mean the surface of the earth but also all the natural resources and free gifts of nature available and used in the production process. Importance of Land It is for extraction of mineral resources It is used for erection of residential or office buildings The reward for land is rent It is useful for farming, food production and animal husbandry It helps in the generation of income such as rent, royalties , etc FEATURES OR CHARACTERISTICS OF LAND It is a gift of nature It is a place where industries are sited The price of land varies according to its location and demand Unlike other factors of production, land cannot be moved from one place to another. Labour This is all human efforts physical or mental, directed towards the creation of goods and services. The reward to labour for its contribution in production process is salary or wages. EVALUATION Define Land Labour IMPORTANCE OF LABOUR Physical or mental efforts of man brings about a means of living. Labour aids career development Labour helps people to move from one job to another and from one place to another The collective efforts of people helps in national development. FEATURES OF LABOUR It is the human effort in production process Labour is rewarded with salary or wages Labour can move from job to job and from place to place. Labour can specialize in given areas The trained labour is the specialized labour and is the expensive Capital This is wealth set aside for the production of further wealth. Capital can be in the form of machine money, property or equipment used is starting a business. IMPORTANCE OF CAPITAL Money aspect of capital helps in providing materials for production. It makes assessment possible, by making comparison. Capital attracts investors into the business. It makes every aspect of production activity possible FEATURES OF CAPITAL It is made by man It is scarce Capital as money is difficult to earn The reward to capital for contributing to production is interest ENTERPRENEUR OR ORGANIZATION This factor of production arranges, directs and controls the other factors to make production possible. He plans the number or quantity of other factors required for production. The reward of the entrepreneur in production effort is profit. IMPORTANCE OF ENTERPRENEUR He brings the capital (i.e money), machine equipment and hires the labour needed for production. He decides what to produce and how to produce. He bears the risks connected with production. He controls and supervises the contribution of the other factors of production FEATURES OF THE ENTERPRENEUR He brings the capital for the business He determines what to produce He employs labour required EVALUATION List the four factors of production What is their respective rewards in production process? GENERAL EVALUATION Define each of the factors of production List these factors and their rewards What factor arranges the others? What factors is made by man? Which factor is a gift of nature? WEEKEND ASSIGNMENT – SECTION A ________factor receives the reward of interest. A. Land Labour C. Capital D. Enterpreneur Factors of production are also called ________ of productionA. agents owners C. givers D. friends The factors that are provided by God and by man are rewarded with _____ and ______ according by A. wages and profit B. rent and wages C. rent and interest D. Profit and salaries _____ is defined as all the physical and mental efforts of man in production capital B. Labour C.Enterpreneure D. Land _____ is defined as wealth set aside for the production of more wealth Land Labour C. Capital D. Enterpreneur SECTION B List three (3) importance of each factor of production List two (2) features of each of the factors of production. See also THE CLERICAL STAFF THE OFFICE RIGHT ATTITUDE TO WORK INTRODUCTION TO BUSINESS STUDIES SIMPLE TABULATION