In order to produce goods and services businesses need to use resources.  These resources are the inputs for business activity.  These resources are what we call the FACTORS OF PRODUCTION.

They are:

• LAND – which is all the natural resources such as oil, water, and the land itself.
• LABOUR – which is the human resources including all the people who work for the organisation.
• CAPITAL – which includes all the man-made resources such as machines, tools and factories.
• ENTERPRISE – the entrepreneur is the person who brings together all the other resources and takes the risks to produce the goods or services.

The wealth of countries is measured by how many goods and services the country can produce.  So, the more business activity there is, the more goods and services that are produced, the wealthier a country is.  So, the more we produce, the better off we can become.