Factors Influencing Production

Factors influencing
Production
c.arunkumar
1225115321

CONTENTS
 Factors of production
 Description
 Sectors
 Key Factor
 Conclusion

FACTORS OF PRODUCTION
• Land
• Labour
• Capital
• Entrepreneurship

LAND
Includes any natural resources used to

produce goods and service i.e. not just land but anything that comes from land
 Land refers to all natural resources both

renewable and non renewable.
Income that resource owners earn in return for

land resources is called rent

LABOUR
Labour is the effort that people contribute and

includes all physical and mental activities which are required for the production of goods and services.

If you have ever been paid for a job, you have

contributed labour resources to the production of goods or services.

CAPITAL
Capital differs based on the worker and the type

of work being done
Exists at two levels.
Financial capital: This is used to purchase physical capital that goes into making other things.  Physical capital : This consists of machinery, equipment, tools, etc.
Providers of capital receive interest.

ENTREPRENEURSHIP
An entrepreneur is a person who combines the

other factors of production - land, labour, and capital. They are the risk takers that set up and run

business enterprises.
Without the entrepreneur combining land,

labour, and capital is not possible.

SECTORS
Primary sector (Farming , Mining)
Secondary Sector (Manufacturing i.e. Textiles

etc)
Tertiary Sector (Services i.e.

Banking,Insurance etc)
Manufacturing is a wealth-producing sector of

an economy, whereas a Service sector tends to be wealth-consuming.

 Although the factors of production are

traditionally split up into land, labour, capital and enterprise, you can also use a common sense categorisation based on specific companies  For a manufacturing company typical factors

employed will be:
management and employees
raw materials
plant and equipment.

KEY FACTOR
Each and every factor plays a key role in

production of goods.
The conversion of input to output is not

possible without any one of the above mentioned factors.
Factors of production are like building blocks

of the economy used to produce goods and services. CONCLUSION
 When it comes to choosing any one factor as

the most important factor influencing production then Labour(employees) might be my choice.
It is not enough to simply have a job, an office or organization to work in, and get a cheque at the end of the month.
Employee productivity is a major concern for employers. I chose the word concern because if the productivity from the employees gets reduced then that will have an huge impact on the entire process.

A workplace however large or small has to be

driven by efficiency and achievement that manifests itself in the form of tangible results for the organization, and is rewarding for the employee. Employee talent is a valuable asset for a company or organization and lower productivity cannot be blamed on the employee entirely. So, Labour(employees) have an edge when it comes to choosing the most important factor of production

THANK YOU.