Business Activities and Factors of Production

Business Activities and Factors of Production

Chapter 1

A Need

a good or service essential for living

A Want

a good or service which people would like to have, but which is not essential for living. It's unlimited.

Scarcity

economic problem where wants is unlimited but resources are limited

Factors of Production

• Land

• Labour

• Capital

• Enterprise

Land

all the natural resources provided by nature includes field, forests, oil, gas, metals, mineral resources

Labour

number of people available to make products.

Enterprise

the skill and risk-taking ability of the person who brings the other resources together to produce a good product.