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 baths and small locally owned stores. The decision to include these amenities is an example of which factor of production?

Answer 1

The decision is an example of entrepreneurship.

Factors of production are elements invested to have an economic profit. The four known factors are land, labor, capital and entrepreneurship. This last one consists of the creativity that a person has to discover or notice an economic demand and uses the other three elements to create an economic profit.

The decision to bring solar powered houses, bike baths and small locally owned stores to the new community is an example of entrepreneurship because the nature of the decision has a sense of innovative iniciative.

Answer 2

With these amenities what they are doing is creating business in this new market in order to obtain profit, this market could change the living style in the residents, each one these ideas would solve a problem on the growing community, this factor of production is called entrepreneurship.