Question

What is regarded as a factor of production and why?

Options

• Capital

• Interest

• Profit

• Rent

Answer 1

Capital

Explanation:

Capital is regarded as a factor of production because it represents the tools, machinery, equipment, buildings, and other physical or financial assets used to produce goods and services. Capital enhances the productivity of labour and land by enabling more efficient production. Along with land, labour, and entrepreneurship, it is one of the four primary factors of production.