Practise classifying land, labour, capital and enterprise and analysing how skills, technology, factor rewards, specialisation and entrepreneurial decisions affect production.
What is meant by the division of labour?
A process is split into a series of individual tasks.
Some workers work part-time and others work full-time.
The same amount of output per hour is produced by each worker.
Wages are divided equally between workers.
What is considered the essential requirement for all entrepreneurs?
attracting customers
buying stock
managing staff
taking risks
A wine producer and bottler wanted to expand its production significantly. To finance the expansion it offered investors discounts on restaurant meals if they bought 2000 shares in the company.
Which factors of production are most likely to be involved in this expansion?
labour, land, capital and enterprise
labour, land and capital only
enterprise and land only
enterprise only
The factors of production earn different rewards.
What identifies the correct economic term for these rewards?
capital - surpluses
enterprise - dividends
labour - interest
land - rents
A country increases its spending on education and training. It pays for this by reducing unemployment benefit payments and increasing taxes on imports of machinery.
What is the likely effect of these changes?
human capital
physical capital
decreases
decreases
decreases
increases
increases
decreases
increases
increases
