DEPARTMENT OF TECHNICALEDUCATION

ANDHRA PRADESH
Name : P. Sankara Rao
Designation : Lecturer
Branch : Commercial & Computer Practice
Institute : Govt. Polytechnic, Srikakulam
Year/Semester : V Semester
Subject : Business Economics I
Subject Code : CCP 502
Topic : Laws of Production
Duration : 50 mts.
Sub Topic : Factors of Production
Teaching Aids : PPT & Animation

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Objective
On completion of the period, you would
be able to:
 Define the meaning and definition of factors
of production
 List various types of factors of production
 Define land and labour

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 Why you have a pen?
 How is it produced?

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Production
 Result of combination of factors of
production

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Factor of production
 Agent helping in the process of production

 Production becomes easy

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Classification
Basically the factors of production are
broadly classified into :
 Land
 Labour
 Capital
 Organization

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Land

 Ordinary soil or surface

 Economically all the resources provided in nature
 Includes climate, water, nature, forest etc.

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Definition
“The materials and forces which nature gives
freely for man’s aid in land and water, in air and
light and heat”.
-Marshal

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Importance
Land can be said in these ways:
a) as a store of raw material and natural
resources.
b) it provides space to mankind
c) in providing food grains to the mankind.

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Features Of Land
1. Free gift of nature
2. Has no cost of production
3. Permanent
4. Fixed in supply
5. Differs in fertility

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Labour

 Physical effort of worker

 In the ordinary language labour, means the
physical effort of a worker. Any work, physical
or mental which is undertaken for payment
either in cash or in kind is known as labour.

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Types Of Labour
1. Productive labour
2. Unproductive Labour

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Features
 Perishable
 Inseparable from individual
 Weak bargaining power
 The supply of labour can not be quickly
changed in accordance with the changes in
demand
 Laborers differ in efficiency

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Productive Labour
The labour which helps in the production of
goods is called productive labour.

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Unproductive Labour

The labour which does not help in the production of

goods or services is called un productive labour.

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Summary
So far we have discussed
 Production
 Factor of production
 Land- All the natural resources
 Labour – Productive & Unproductive

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Quiz
1. Labour is ________________
b) Destructive
c) Participative
d) Perishable
e) Active

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Quiz

1. The supply of the following remain fixed

b) Labour
c) Capital
d) Land
e) Entrepreneurship

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