FACTORS OF PRODUCTION
Storyboard Description
Introduction to the factors of production
Storyboard Text
- I 've always wondered how paper gets produced in this factories
- Why don't we find out? Let's ask for a tour!
- All production starts with land, labor, capital, and entrepreneurship
- Thanks for giving us a tour! We would like to understand the production process. We are so excited..
- Land is all of the natural resources found on Earth. Here is the raw materials that came from the trees to begin the paper making process. Wood from trees are cut into small pieces.
- Would other examples be oil, minerals and coal?
- That's all correct! and entrepreneurship is the innovation, skill, vision, and creativity required to start a business. Here we have the final product, paper.
- Exactly! And labor is time, expertise, and effort that humans put into making all goods and services. Here the machines and workers cut and boil the wood.
- Would that mean capital is the resources made by humans for production?
- Capital is also divided into three categories: human, physical, and financial
- So financial capital is the money used to buy the goods and services?
- So that would mean human capital is the experience that result in knowledge or skills to produce goods and services?
- Yes! Physical capital is the physical resources available to a business. Here the paper is made into pulp
- Oh! So entrepreneurs must combine all four factors of production to drive the economy!
- Thank you for the tour! Now we both have a better understanding of how the economy works and how paper is made!
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