State two different examples of the factor of production known as land.
How to approach this question
Recall the definition of 'land' in economics. It refers to all natural resources used in production. Provide two distinct examples.
Full Answer
Two examples of land as a factor of production are:
1. Natural resources such as oil, coal, or minerals.
2. Physical land itself, such as a field for farming or the site for a factory.
In economics, the factors of production are the inputs used to produce goods and services. 'Land' is the primary factor of production and encompasses all naturally occurring resources whose supply is inherently fixed. This includes not just the physical land but also the resources within it (minerals, oil) and on it (forests, rivers).
Common mistakes
Only thinking of land as a plot of ground and not including other natural resources like water or minerals.
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