factors of production

There are four factors of productions 

• Land 
• Labor 

• Entrepreneurship 
• Capital 

-  Land 

• Natural resources 

- Labor 

• Work exerted 

- Entrepreneurship  

• Risk taker and innovative 

- Capital 

• Human- knowledge and skill a worker gains through education, experiences 

• Physical- human made objects used to create other goods/ services 

Opportunity cost- the next best alternative that you must give up in order to get something (a form of trade off) 

Law of increasing opportunity cost-  as you produce more of one good, the opportunity cost (the far-going production of another good) will increase 

Efficiency: using resources in such a way to maximize the production of goods or services (profit increase) 

trade offs- most preferred possible alternatives

Productions Possibility Curve:

This graph shows alternative ways to use an economy's resources.