Physical Capital Resource
When a chef creates a dinner plate of food for a customer, which of the following represents the physical capital resource?
Man-Made Resources
What are man-made resources? Man-made resources are objects or things converted from natural resources. Examples are plastic, paper, sheet metal, and brass.
Factors of Production
What inputs are used to produce goods and services? The inputs are called factors of production. They include resources like land, labor, capital, and entrepreneurship.
Capital Productivity
What is capital productivity? It measures how well capital produces goods and services.
Market Equilibrium
Hedge Fun contracts 140 homes for its landscaping service at $1300 annually. Its costs average $900. What is market equilibrium? It has the most total surplus and meets four efficiency conditions. What is total surplus? It is the sum of consumer and producer surplus.
Types of Factors of Production
Resources used in production are called factors of production. Major types are capital, labor, and land.
Natural Resources
Natural resources provide food, fuel, materials, heat, light, and power. Environment relates to human development through the resources it provides.
Human-Made Resources
Human-made resources come from modifying natural ones. Technology and skill convert them into usable forms. Knowledge and skill are required to use man-made resources.
Labor
Labor is physical and mental effort to produce goods and services. Individuals work various jobs. Employers pay them wages and benefits. Knowledge, skills, and experience make workers productive – that is human capital.
Entrepreneurship
Entrepreneurs organize factors of production into businesses that provide goods and services. They take risks for potential profits. The Hasty Hare studies customer demand so its designers can create popular models.