Question

Approximately 200 people are working on developing a new community just outside a major city. Unlike other communities in the area, the development will feature innovative amenities such as solar powered houses, bike paths, and small, locally owned stores. The decision to include these amenities is an example of which factor of production?

Answer 1

The decision to include these amenities is an example of entrepreneurship factor of production. Land, labor and capital are three of the four factors of production. Entrepreneurship is the fourth and factor of production and in this phase, land, labor and capital are all combined.

Since the city is behind developed with new amenities, land, labor and capital are all being combined to achieve developmental success.

Answer 2

The decision to include these amenities is an example of the entrepreneurship factor of production. This is because the entrepreneur gets to combine all factors and resources (land, labor, and capital) in order to gain benefit or profit from it.