Factors of production

Definition

Factors of production refer to the resources used in the production process to create goods and services. These resources include land, labor, capital, and entrepreneurship.

Related terms

Land: Refers to all natural resources used in the production process such as forests, minerals, and water.

Labor: Represents the physical and mental effort exerted by individuals in the production process.

Capital: Includes all man-made tools, machinery, buildings, and equipment used for production purposes.