Y10 Economics - C21 Firms and Production

What are the four factors of production?

• Labour, Capital, Goods, Services

• Land, Labour, Capital, Enterprise

• Land, Labour, Money, Management

• Land, Technology, Capital, Enterprise

What does derived demand mean?

• Demand for services is always higher than goods.

• Demand is only based on the cost of production.

• Demand for goods is independent of production factors.

• Demand for factors of production depends on the demand for goods and services.

Which factor affects the demand for production factors?

• Only availability

• Only quality

• Only cost

• Cost, availability, and quality

What is an example of a labour-intensive industry?

• Car manufacturing

• Mobile phone manufacturing

• Accountancy

• Oil extraction

What is a characteristic of capital-intensive production?

• Flexibility in production

• Low output

• High startup costs

• High reliance on human labour

What is one reason firms might choose capital-intensive production?

• To produce highly customized products

• To reduce human error

• To increase flexibility

• To lower the quality of products

What does productivity measure?

• Quality of goods produced

• Cost of production

• Efficiency of output per unit of input

• Total output of goods and services

Why is higher productivity important for an economy?

• It increases unit costs

• It reduces competition

• It helps raise employment and standards of living

• It decreases tax revenue

Which factor does NOT influence productivity growth?

• Skills and experience

• Innovation

• Government regulations

• Investment in technology

What is an advantage of labour-intensive production?

• Reduced need for skilled workers

• Mass production capabilities

• Higher flexibility to meet demand

• Lower costs due to automation