The four factors of production that an economy needs to produce something are:
- Land
This includes all natural resources used in production, such as physical land, minerals, water, forests, oil, and other raw materials. Land provides the basic natural inputs required for production
- Labor
Labor refers to the human effort, both physical and mental, used in producing goods and services. This includes workers, their skills, knowledge, and time contributed to the production process
- Capital
Capital consists of man-made resources used in production, such as machinery, tools, buildings, equipment, and infrastructure. It also includes financial capital used to buy these physical assets. Capital helps facilitate the production of goods and services
- Entrepreneurship
Entrepreneurship is the ability to organize, manage, and assume the risks of a business venture. Entrepreneurs bring together land, labor, and capital to produce goods or services, innovate, and drive economic growth
These four factors work together as the essential inputs for producing goods and services in an economy. Their availability and efficient combination determine the level of economic output
