1. Factors of production Resources used for production Types: Land
Capital
Labour
Entreprenuership

2. Land Natural resources Characteristics A gift of nature
Limited in supply
Land is immovable
The supply of land involves no opportunity cost

3. Capital Man-made resources used for further production
Examples: machines, raw materials, tools
Features:
Man made
It raises the productivity of other factors

4. Land or Capital? Ice at Mount Everest Ice in a skiing field Sea water
Sea water in a seafood restaurant
Sharks in the Atlantic Ocean
Sharks at the Ocean Park

5. Human Resources
Labour
Entreprenuership

6. Labour Supply Measured in terms of time (man hour)
Labour supply = no. of workers x no. of working hours per worker

7. Labour Supply Measured in terms of time (man hour)
Labour supply = no. of workers x no. of working hours per worker
Factors affecting labour supply:
Size of population
Size of working population
No. of working hours

8. How to increase labour supply?
 population growth (by natural growth or immigration)
 monetary rewards
 import of labour from other countries
 retirement age (e.g. from 60 to 70)
 school leaving age (e.g. from 16 to 17)

9. Labour productivity
Measured in terms of output per unit of labour

10. How to raise labour productivity?
Better education and training
Other factors of production( quantity & quality)
Better management or organization. e.g. division of labour
Better working conditions
Greater fringe benefits (housing allowances,medical care,bonus, meal..)

11. Mobility of Labour
Geographical mobility: the ease at which labour can move from one working place to another.
Occupational mobility: the ease at which labour can change from one type of job to another

12. Factors affecting occupational mobility
Monetary / non-monetary rewards
 income of the present job (higher opportunity cost in changing job) mobility 
Specialization of skills   mobility 
Licensing requirements   mobility 
Higher age of workers  mobility 

13. Factors affecting geographical mobility of labour
Transport
Social factors
Economic conditions ( home country/other countries)
Political stability
Immigration or emigration restrictions

14. Factor returns
Rent
Interest
Wage
Profits