Factors of production

Definition

Factors of production are the resources businesses use to create goods or services, including land, labor, capital, and entrepreneurship. These factors are essential inputs for the production process in any economic system.

Related terms

Land: Natural resources that are used in the creation of products or services.

Labor: The human effort, skills, and abilities used in the production process.

Capital: Assets such as machinery, tools, and buildings used to produce goods and services