Business Economics: A basic understanding of the Four Factors of Production (Essential for those just starting to learn Business Economics and understanding the production process)

4 Production factors:

1.Natural resources

2.Human resources (labour)

3.Capital

4.Entrepreneurship

Raw material changed into a reliable final product e.g.

Milk Chocolate

Chocolate sweets

The input needed to change raw materials into final products is know as production factors. In most cases, all four-production factors are used to make final product. Not all 4 factors are always available. Therefore, there is a shortage of certain production factor (Raw material)

1.Natural Resources

a)Agriculture- fruit, vegetables and meat

b)Mining - gold, iron, coal and ore

c)Fisheries - fish, crayfish, abalone

d)Forestry - timber

This includes farms and plantations, as well as land where roads and buildings are constructed. Supply of minerals is limited which shadow be exhausted. Land, fisheries, forestry, and agriculture cannot be exhausted but essential be managed responsibly.

Inputoutput

Wood à paper product/ furniture

Wheatà flour

Gold àJewellary

FishàFrozen fish products

2.Human Resources

-This is the parcel that people make to the production process.

All workers contribute to the production process.

-Many prices in S.A. prolong become expencive because of high remuniration demanded by workers and trade unions. sometimes it is cheeper to import certain products eg. Clothing, butter, shoes.

Human resources or labour is devided into 3 groups:

a)Professional valet resources. These are highly skilled and trained people, eg. Doctors, attourneys and engineers.



These workers go authorized post-school training and usually specialise in certain fields.

b)Skilled forgiving resources. These people have a reasonably hugh level of education, eg. Secreterial personnel, mechanics, carpenters and electricians. The workers have been trained for a specific task.

c)Unskilled human resources. These people have a low level of training eg. farm workers, domestic servants, mine workers and road workers. They have not been trained for a specific task.

Human resources and labour uses natural resources and capital to make goods and serve available.

Workers productivity...

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