Unit 1.1 · What Is Economics? Scarcity, Choice, and Economic Models
Factors of Production
AO2
Syllabus Requirement
Defines land, labour, capital, and entrepreneurship as the resources underlying all production and the basis for income distribution.
Assessment Objectives
AO2Application and Analysis
Summary
Factors of production are essential resources needed to create goods and services, categorized into four groups: land, labour, capital, and entrepreneurship. Understanding these factors is important in economics as they highlight the inputs necessary for production and the role each plays in the economy.