The economic resources of land, labour, capital and enterprise are called as the factors of production.

1. Land: It refers to all the natural resources used in the production such as oil, coal etc. In addition, the water, plants, animals etc are also included. Example: Farmland, minerals, sea. Land resources are the raw materials in the production process. These resources can be renewable, such as forests, or nonrenewable such as oil or natural gas.Land gives us rent

2. Labour: Labour stands for the human effort (mental or physical) that is used in producing goods and services. Example: A teacher, workers.Infact all people with their efforts , abilities and skills are termed as labour.labour gives us wages

3. Capital: Capital refers to all the human made (man-made) goods used in production. Example: Machinery and equipment, factories, conveyor belts, computers, delivery vans etc.Capital gives us interest.

4. Enterprise: It refers to the risk bearing and the key decision-making function in a business. This is needed as some events cannot be anticipated beforehand and might not qualify for being insured. Example: An entrepreneur.Enterprise gives us profit

MOBILITY OF FACTORS OF PRODUCTION IS AFFECTED BY THE FOLLOWING FACTORS:

1.Difference in the price and the availability of housing in different areas and countries

2. Family ties

3. Difference in the educational system in different ares and countries

4. Restrictions on the movement of workers

5.Lack of information

Functions of money are as follows:

1. Acts as a medium of exchange

2. It is a standard of deferred payments

3. It is a nit of account

4. It is a store of value

The following factors affect the demand of a product:

1. The price of the product

2. Changes in income

3. Price of substitute goods/services

4. Price of complementary goods/services

5.Changes in income

6.Changes in tastes and preferences of customers

Factors affecting borrowing:

1.Availability of loans and overdrafts

2. Rate of interest

3. Confidence

4. Social attitudes

Characteristics of developing economies:

1. Low level of health care

2. Low level of education

3. Low level of savings

4. High rate of population growth

5. Low income per head

6. Low life expectancy

7.High infant mortality rate

8.Low level of capital investment

9.Poor infrastructure

10.Poor housing and sanitation

11.High proportion of workers in the primary sector

Functions of commercial bank:

1.Acceptance of accounts in savings and current accounts

2.Enable customers to make payments

3.Can lend money

4.Provide traveler cheque/Foreign currency

5.Accept deposits of valuables

6.Advice on financial matters

7.Buy/Sell shares for customers

MICROECONOMICS AND MACROECONOMICS

MICROECONOMICS:

1.It is the study of  the behaviour and the decision of households and firms and the performance of individual markets.

2.Studies variables such as the amount of a firm’s output or of a consumer’s income etc.

MARKET: It is an arrangement which brings buyers into contact with sellers

MACROECONOMICS:

1.It is the study of the whole economy.

2.It studies the aggregate economic behaviour. That is the behaviour of aggregate economic agents on aggregate economic markets.

3.It deals with the economic issues  that affect the entire economy and most of the society.

4.It studies aggregate variables such as gross domestic product, national income, aggregate demand, general price level, rate of unemployment