Question

1.) Name and describe / explain the 4 Factors of Production. Give an example of each factor of production.[ Chapter 1]

2.) What is GDP? What is GDP Per Capita? What is Average GDP? Why is GDP important in economics? [Chapter 2]

3.) What are Markets? Who participates in markets? What is a Product Market? What is a factor Market? What is Market Demand? [Chapter 3]

Answer 1

1.The four factors of production are-

Land,labour,capital and entrepreneurship.

Labour is the workforce or individual workers.

Capital is the amount of investment or funds required for production.Capital can also be described as physical capital-machinery etc.

Entrepreneurship is related to decision making role in production.

2.GDP is the final value of all goods and services produced in an economic in a given year.

GDP per capital is GDP/Population

GDP is important because it indicates the total production which indiactes growth.A higher level of GDP accounts for higher output and higher employment.

3.Market is a physical or virtual entity in which goods and services are exchanged for money.Producers and consumers participate in market.

A product market is one in which goods and services are traded.In factor market ,the factor of production (labour and capital) are traded for wages and rent.

Market demand is the total demand from all consumers for a particular good.