FACTORS OF PRODUCTION

resources required to produce goods and services 

      

   1. LAND-Natural resources

   2. LABOR-Work force

   3.CAPITAL

         Physical -tools,machinery, etc

         Human- skills talent knowledge 

   4.ENTREPRENEURSHIP

        INNOVATIVE

                RISK TAKER

Trade offs- Alternatives that we give up whenever we chose open course of action over another 
Opportunity cost- best next alternative