Natural resources

Labor

Capital goods

Anything provided by nature that affects the productive ability of a country.

Human effort, either physical or mental, that goes into the production of goods and services.

Capital goods are buildings, tools, machines, and other equipment that are used to produce other goods but do not directly satisfy human wants.

In creating useful goods and services, a producer uses four basic resources. These resources, called factors of production, are land, labor, capital goods, and entrepreneurship.

Entrepreneurship

For the production of goods, more is needed than the mere ability of natural resources, labor, and capital goods. Entrepreneurship brings together the other three factors.