Look at the truck. On a piece of paper, write down all the things that went into the production of this truck.

Four Factors of Production These are the things (“factors”) that go into the making (“production”) of things (“things”) There are four of them: Land Labor Capital Entrepreneur

Vocabulary natural resources not created by humans Land Labor natural resources not created by humans people with all their efforts, abilities, and skills

Vocabulary (2) Capital Entrepreneur tools, equipment, machinery, and factories used in the production of goods and services a risk-taker in search of profits who does something new with existing resources

A Visual Representation

So… Based on these four factors of production: Are we missing anything that went into the production of that Ford truck from the first slide? Where do the factors get grouped?

Land Labor Capital Entrepreneur

Human Capital NOT one of the factors of production However, still important Defined as “sum of peoples’ skills, abilities, health, and motivation” So, knowing this, what are some steps you could take to IMPROVE human capital?

Journal Question Which of the four factors of production is the most important factor? Why?