Question

You are a producer who is hoping to create a specific good.


Based on what you have learned about resources and scarcity, what factors do you need to consider when producing this good?


Give your answer in the form of three to four complete sentences.

Answer 1

The factors of production that any manufacturer needs to consider when aiming to transform raw materials into final goods and services are the following:

• Land, ground properties and buildings.
• Labour, employees who work in the transformation processes in return for a salary
• Capital: machinery and financial means.

Finally, a last resource is necessary. This is the entrepeneur, which is the person who needs to organize the other factors so that the productive activity ends up sucessfully.

Answer 2

Answer:

Producers must consider how limited a resource is when it is used to create an item. The more scarce a resource is, the greater value is given to that resource. It is important to determine if it is necessary to use a scarce resource to create a good, because a less scarce resource could be used instead. This would make it easier to produce a good, but it would give the final item a lower value.

Explanation:

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