This document presents information on factors of production. It defines production and factors of production, and outlines the four basic factors: land, labor, capital, and entrepreneur. Land refers to all natural resources and is a free gift of nature. Labor is human economic activity with head and hand. Capital consists of manufactured means of production like factories and machines. The entrepreneur brings together land, labor, and capital to make production decisions around what, how, and where to produce, taking on associated risks. Each factor is described in more detail regarding its nature and key features.

1. CE/IT Department
SANKALCHAND PATEL COLLEGE OF ENGINEERING-
VISNAGAR
A Presentation on
FACTORS OF PRODUCTION
Guided By:
Prof.Piyush S. Suthar
Prepared By:
Ankit Bhasnushali (150400107002)
Darshan Oza (150400107025)
Shaily Patel (150400107049)
Urvish Patel (150400107053)

2. CONTENTS
1) What is Production.
2) What is Factors of Production.
3) Basic Factors of Production.
 Land and its Features.
 Labour and its Features.
 Capital and its Features.
 Entreprenuer and its Features.

3. What is Production
Production is an outcome of an economic
activity.
Prof. J.R.Hicks defines Production as "any
activity directed towards the satisfaction of other
peoples wants through exchange."

4. What is Factors of Production
Anything that assist production is
termed as factor of production.
 But mere existence is not necessarily a factor
of production.
It become a factor of production
only when it actually assist or
contributes to production.

5. Basic Factors of Production
LAND
LABOUR
CAPITAL
ENTREPRENUER

6. Land
 Land is the original and primary factor of
production.
Without land the production process cannot
exceed further.
In Economics all the natural resources that are
available –
a) on the surface of the earth
b) below the surface of the earth
c) above the surface of the earth
and which are used in the production
process is called LAND.

7. Land is a free gift of nature.
 Land has no cost of production.
 The supply of land perfectly inelastic.
 Land is subject to Law of Diminishing
return.
Land is immobile.

8. LABOUR
 Labour is a human factor of production.
In economics labour is defined as- “Economic
activity of man with HEAD and HAND.”
 LABOUR is human factor of any kind, manual or
mental,skilled or unskilled, scientific or artistic
undertaken with a view of creating or adding utility.

9. Features of Labour
 Labour is a human factor.
Active factor.
 Labour cannot be stored.
 No two labours are identical.

10. Capital is a man-made resource of production
used to produce further wealth.
It refers to the stock of capital assets such as
factories,machines, tools & equipments, raw
material, transport vehicles etc…
Therefore capital is defined as “Produced
means of production”

11. Features of Capital
 Capital is man-made factor of production.
 Supply of capital is elastic.
 Capital has mobility.
All capital is wealth but all
wealth is not capital.

12. Entreprenuer
Entreprenuer is a person who brings in
land, labour & capital in one place & uses it
for the production process.
 He is the person who decides-
a) What to produce?
b) How to produce?
c) Where to produce?
 The person who takes these decisions
along with the risk associated with them is
known as ‘Entreprenuer’.

13. Features of Enterprenuer
He must be a good administrator.
He must possess complete knowledge.
He must be a person of imagination.
 He must be a man of action.

14. THANK YOU