2. TOPICS:
• INTRODUCTIONINTRODUCTION
• IMPORTANCEIMPORTANCE
• CLASSIFICATION OFCLASSIFICATION OF
THE FACTORSTHE FACTORS
• LANDLAND
• LABORLABOR
• CAPITALCAPITAL
• ENTERPRENEURSHIPENTERPRENEURSHIP
• CHARTCHART
• OPTIMUMOPTIMUM
COMBINATION OFCOMBINATION OF
FACTORS OFFACTORS OF
PRODUCTIONPRODUCTION
• CONCLUTIONCONCLUTION
2
3. An economic term to describe the
inputs that are used in the production of
goods or services in the attempt to
make an economic profit.
The factors of production include..
Land
Labor
Capital
Entrepreneurship
INTRODUCTION:INTRODUCTION:
3
4. Factors of production are the resources
that allow us to create finished products
and perform services. You cannot
create a product out of nothing.
IMPORTANCE:IMPORTANCE:
4
8. CLASSIFICATION OF THECLASSIFICATION OF THE
FACTORS:FACTORS:
All of these factors of production, without
any exception are indispensable for the
production because nothing can be
produced without these factors. So much,
so even any single factor is missing from
the process of production, nothing could
be produced.
8
9. LAND:LAND:
he word ‘land’ is used as a term in economics.
In daily conversation this word refers to the
surface on which we live, rivers are flowing,
mountains are erected or the jungles are grown.
All the things are called land whether they
exists on the surface, under the ground or even
in the space.”
9
10. ISSUE CONSULTING OF LAND:ISSUE CONSULTING OF LAND:
urrently in Pakistan a lot of land both fertile and
barren is unutilized and it should be can into
utilization.
10
11. LABOR:LABOR:
abor is the effort that people contribute to the
production of goods and services. Labor
resources include the work done by the waiter
who brings your food at a local restaurant as
well as the engineer who designed the bus that
transports you to school.
11
12. ISSUE CONSULTING OF LABOR:ISSUE CONSULTING OF LABOR:
n Pakistan a lot of labor is unemployed and
Government should take steps to provide
education and training to them along with
creating a job opportunities.
12
13. CAPITAL:CAPITAL:
The third factor of production is capital. Think of
capital as the machinery, tools and buildings
humans use to produce goods and services.
Capital can represent the monetary resources
companies use to purchase natural resources,
land and other capital goods.
13
14. ISSUE CONSULTING OF CAPITAL:ISSUE CONSULTING OF CAPITAL:
akistan has shortage of capital and technology
and Government must take steps to increase
capital in the country by giving incentive to local
and foreign investor.
14
15. ENTERPRENEURSHIP:ENTERPRENEURSHIP:
An entrepreneur is a person who combines the
other factors of production – land, labor, and
capital – to earn a profit. The most successful
entrepreneurs are innovators who find new ways
produce goods and services or who develop new
goods and services to bring to market.
15
16. ISSUE CONSULTING OFISSUE CONSULTING OF
ENTREPRENEUR:ENTREPRENEUR:
n Pakistan the people have very limited
entrepreneurship; therefore, Government must
take steps to improve entrepreneurship among
people.
16
17. CHART:CHART:
Following chart provides brief tabulated
information on 4 factors of production.
Sr.
No.
Name Of
Factors
Owner Of
Factor
Reward Of
Factor
Nature Of Factor
1- Land Landlord Rent Natural or primary or
original factor
2- Labor Laborer Wages Natural factor or
primary or human
factor.
3- Capital Money Lender Interest Man-made factor
4- Enterprise Entrepreneur Profit Man-made factor
17
19. OPTIMUM COMBINATION OFOPTIMUM COMBINATION OF
FACTORS OF PRODUCTION:FACTORS OF PRODUCTION:
.O.P means land, labor, capital and
entrepreneurship. In every business all these
factor of production are required but there
relative importance's differ. But all the factors of
production are necessary.
19
20. CONCLUSION:CONCLUSION:
ence we can say that no factor is important yet
every factor has its own importance. Therefore,
production = f1
+ f2
+ f3
+ f4
herefore, the producers must select proper
combination of F.O.P.
20
Section 1 of the IB Economics Course aims to “ introduce the basic terminology and concepts of economics. Students are encouraged to consider what markets and governments can and cannot do. This section of the syllabus gives them an early opportunity to begin to explain economic phenomena through the use of diagrams, data analysis and the evaluation of economic material. This section is intended to make students aware of the role of economics in real-world situations. Even at this initial stage teachers and students should consider the application of economic theories to developing countries, since development economics is integral to the course.” (See IB Economics Course Guide available from IBO website.)
As an introductory unit, Section 1 aims to expose students to some very basic economic ideas many of which will be revisited throughout the course. Given the time constraints of the course, it is best not to spend too much time on this section as teaching concepts in isolation and in a disjoined manner may not result in very deep learning. In particular, issues about development economics are covered again in 3.2, and the whole of Section 5 is devoted to it.
Asking students about what they think economics is about usually produces answers that focus on money, business and the stock market.
They may be surprised to learn that economics is about making choices in the face of scarcity of resources. A discussion about how they are always making make choices that require them to weigh up the trade offs of their decisions helps them understand the importance of choice.
Image Source: istockphotoes
You may also add that “Economics is a social science as it is concerned with the study of human behavior. It looks at how humans behave in markets, in firms, and in countries or economies. It also looks at how these economies interact. The 'humans' we are studying may be consumers, workers, decision-makers in firms, or members of the government.”
Triple A Interactive Textbook
An interesting class discussion could center on why economics has had such a bad press at times
For example students might be amused by these comments:
Economics is the “dismal science.” Carlyle, historian of 19th Century.
“I was in search of a one-armed economist, so that the guy could never make a statement and then say: "on the other hand.” Truman, US President
“The First Law of Economists: For every economist, there exists an equal and opposite economist.
The Second Law of Economists: They're both wrong.” Anonymous
A light hearted look at economics is provided by David E. Wildasin at http://davidwildasin.us/humor.html
A more provocative argument was presented by David Brooks in the context of the Global Economic Crisis (GEC) See
http://blogs.triplealearning.com/2010/04/diploma/dp_economics/whereto-the-dismal-science/
You may also add that “Economics is a social science as it is concerned with the study of human behavior. It looks at how humans behave in markets, in firms, and in countries or economies. It also looks at how these economies interact. The 'humans' we are studying may be consumers, workers, decision-makers in firms, or members of the government.”
Triple A Interactive Textbook
An interesting class discussion could center on why economics has had such a bad press at times
For example students might be amused by these comments:
Economics is the “dismal science.” Carlyle, historian of 19th Century.
“I was in search of a one-armed economist, so that the guy could never make a statement and then say: "on the other hand.” Truman, US President
“The First Law of Economists: For every economist, there exists an equal and opposite economist.
The Second Law of Economists: They're both wrong.” Anonymous
A light hearted look at economics is provided by David E. Wildasin at http://davidwildasin.us/humor.html
A more provocative argument was presented by David Brooks in the context of the Global Economic Crisis (GEC) See
http://blogs.triplealearning.com/2010/04/diploma/dp_economics/whereto-the-dismal-science/
All images from Creative Commons
All images from Creative Commons
Definitions: Triple A
Definitions from Triple A Interactive Textbook
Students need to understand that entrepreneurship is related to management but not identical. Entrepreneurs take risks because the future is unknown. Entrepreneurs have both the ability and the willingness to take risks and gather other factors of production to achieve some goal.
All images from Creative Commons
