The resources needed for production

3. THE RESOURCES NEEDED FOR PRODUCTION -

FACTORS OF PRODUCTION Factor of production: are all the resources used to produce goods and provide services.

Three groups: 1. labour - It is the work done by humans to carry out an activity.

- Some types are associated with: • •

-

2. Land -

Thongs that provided by nature that we use to obtain a profit.

Different geographic areas have natural resources: • • • •

-

Skills and technical knowledge Experience and know-how.

Water Minerals Energy sources (oil, natural gas , Sun, wind, rivers…)

Plants and animals.

3. Capital - The assets (activos) already produced or developed that can be then used to produce new producs and services.

- Types: • • • •

Physical: capital goods, (buildings, machinery) Financial: money and investment Technological: technolog, research and development of new applications (R&D) and innovation (R&D&I) Human: worker can move from one place to another, taking skills, creativity and technological kowledge with them.

3. THE RESOURCES NEEDED FOR PRODUCTION THE IMPACT OF FACTORS OF PRODUCTION - Economic activity plays a role in transforming our physical surroundings.

- Two types of impacts: 1. Positive impacts Some regions have many resources and for that reasons they have a economic growth.

This economic growth: -

It is good for the wellbeing of population It produces a better standard of living

Examples: North America, Europe, parts of Asiaand the Pacific.

2. Negative impacts - Activities associated with extracting gas, oiland mineral deposits and forestry.

- These activities have harmful effect on the environment that we call negative externalities.

- They produce deterioration on the environmment. Types: 1.

2.

3.

Depletion on natural resources due to overexploitation Destruction of natural ecosystems Overloading the environment with waste (pollutants, harmful gases, ‌)