Factors of Production

Factors of Production

A tractor is a man-made aid to production and part of capital. Image credit unobi.ac.ke

A tractor is a man-made aid to production and part of capital. Image credit unobi.ac.ke

ZIMSEC O Level Commerce Notes: Factors of Production

  • The four factors of production act as inputs during the production process.
  • They are also generally known as resources.
FactorDescriptionReward
Land-Refers to the site on which production takes place including all the natural resources used in the production process.
For example Freehold land, farming land, a dam/lake, forests, air and mineral ore deposits such as iron ore.
Rent
CapitalThese are all the manmade aids to production including wealth put aside for the production process e.g. money, property plant and equipment, tractors etcInterest
Entrepreneurship/Enterprise/ OrganisationIs the ability, willingness to take risk and skill to run a business.
It combines all the other three factors of production.
Profit
LabourIs the effort put in by people in the production of goods and services.
It can be physical or mental effort.
Wages and Salaries

To access more topics go to the Commerce Notes page.

By |2017-01-17T11:21:27+00:00June 24th, 2015|Notes, O Level Commerce Notes, Ordinary Level Notes|Comments Off on Factors of Production

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He holds an Honours in Accountancy degree from the University of Zimbabwe. He is passionate about technology and its practical application in today's world.
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