There are 4 factors of production; namely land, labour, capital and enterprise
Land: The word land refers to all the natural resources.
Oil, coal, natural gas, metals, stone and sand are natural resources. Other natural resources are air, sunlight, soil and water. Animals, birds, fish and plants are natural resources as well.
Resources may be either renewable or non-renewable.
Renewable resources are the resources which can be revived, through the natural process, over time.
On the other hand, non-renewable resources are the natural resources which are not going to be replenished, shortly.
Renewable resources do not become extinct easily, and so they are sustainable in nature.
Land is geographically immobile in that a given piece of land cannot be removed from one place to another.
However, land can be occupationally mobile in that it can be put to different uses, e.g. farming, grazing and building.
Labour: Labour is the effort that people contribute to the production of goods and services. Labour resources include the work done by the waiter who brings your food at a local restaurant as well as the engineer who designed the bus that transports you to school. It includes an artist's creation of a painting as well as the work of the pilot flying the airplane overhead.
The number of hours and the number of people that work determine the quantity of labour.
Some of the factors influencing the size of the labour force are: Size of the population, the age structure of the population, retirement age, the attitude of women towards work, the school leaving age amongst others.
Capital goods are used to make other goods and services. Capital goods include items like buildings, machinery and tools.
Net investment increases a company's stock of capital goods. Net investment is the total amount of money that a company spends on capital assets, minus the cost of the depreciation of those assets. This figure provides a sense of the real expenditure on durable goods such as plants, equipment, and software that are being used in the company's operations.
Enterprise involves taking risks and making decisions. Some of the factors that encourage enterprise are: Lower taxes, less regulation and improved education
Successful entrepreneurs appear to be geographically and occupationally mobile.