Factors of Production

Natural Resources “Gifts of Nature” Fertile fields, abundant rainfall, forests, mineral deposits School- wood, brick- before they were made into something else they were the natural resources that came form the land

Labor Labor force or human resources. Physical and mental efforts people make for the production of good and services. Building-contractors, bricklayers, electricians School- Administrators, Teachers and other personnel

Capital Tools, machinery, buildings used to make products. Someone else has to produce the hammer in order for you to build a house. Consumer goods: Clothes, shoes, foods, bicycles, radios- satisfy wants directly Capital goods: satisfy wants indirectly by aiding production of consumer goods.

Entrepreneurs People who start new businesses, introduce new products, improve management techniques. Being innovative, being able to take risks. Thought of as the driving force of economy. Use factors of production to produce new products.