Definition
- Factors of production
- Factors of production are the inputs, grouped as land, labour, capital and enterprise, that a firm combines to produce goods and services.
- Not to be confused with: Financial capital
- Financial capital is money raised through loans and equity investments, which pays for inputs and produces nothing by itself.
Test yourself
What is the difference between factors of production and financial capital?
Factors of production make things; financial capital is money that pays for them and makes nothing.