Factors of production
What Factors of production means in Economics A-Level, as defined for AQA.
Definitions of Factors of production
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Reference: AQA
The inputs whose flexibility determines whether a period is short run or long run, with at least one fixed in the short run and all variable in the long run.
The economists' classification of economic resources into land, labour, capital and enterprise, which are required to produce goods and services.
The inputs a firm uses, which can be fixed or variable, such as capital like factory size or heavy machinery, and labour.
Land, labour, capital and enterprise, the finite resources required to produce goods and services.
The inputs of a business, all of which can be altered in the long run.
Changes in their quantity or quality shift long-run aggregate supply.
Topics that use Factors of production
- Aggregate demand and aggregate supply analysis (AQA A-Level)
- Costs of production (AQA A-Level)
- Economic resources (AQA A-Level)
- Scarcity, choice and the allocation of resources (AQA A-Level)
- The law of diminishing returns and returns to scale (AQA A-Level)
Related terms
- Costs of production
- Diminishing marginal returns
- Economies of scale
- Short run
- Aggregate demand
- Aggregate demand components
- Aggregate supply
- Capacity constraints
Using Factors of production in the exam
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