AP Micro & MacroCore Economic Concepts
Factors of Production
Factors of production are the resources used in the production of goods and services, including land, labor, capital, and entrepreneurship.
Land refers to natural resources, labor is the human effort, capital includes man-made resources like machinery and equipment, and entrepreneurship is the risk-taking and organizational ability of business owners. These inputs are combined in various ways to produce outputs. The quantity and quality of a country's factors of production determine its productive capacity.