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Question
Which function of an entrepreneur allows him to decide the reward that each factor of production should get?
Options
Innovative function
Distributive function
Risk wearing
Decision-making function
Solution
Distributive function
Explanation:
- The distributive function of an entrepreneur involves determining how the total income generated by a business is allocated among the various factors of production, including land, labour, and capital.
- This function allows the entrepreneur to decide the reward or compensation for each factor based on its contribution to production.
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