Multiple Choice
Which of the following lists correctly identifies the four main factors of production in economics?
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0. Basic Principles of Economics
Factors of Production
Multiple Choice
Which factor of production is most directly associated with a firm's ability to communicate with people globally?
A
Capital
B
Entrepreneurship
C
Labor
D
Land
Verified step by step guidance1
Understand the definition of each factor of production: Land refers to natural resources; Labor is the human effort used in production; Capital includes tools, machinery, and technology; Entrepreneurship is the ability to organize and manage resources to produce goods and services.
Identify what is meant by 'a firm's ability to communicate with people globally'—this typically involves technology such as computers, telecommunications equipment, and the internet.
Recognize that technology and equipment used for communication fall under the category of Capital, as it represents physical assets used in production.
Compare the other factors: Labor involves human work but not the tools themselves; Entrepreneurship is about organizing resources, not the communication tools; Land is natural resources, unrelated to communication technology.
Conclude that the factor of production most directly associated with global communication ability is Capital, because it encompasses the technological tools enabling such communication.
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