Economics 0455 · IGCSE · The factors of production
The factors of production — practice question
Estonia uses its factors of production across a variety of industries, such as education. In 2022, the nation faced a shortage of teachers. To draw workers in from other industries, the government raised teachers’ wages. Two further industries in Estonia are building and clothing. Estonia’s firms were affected in 2022 when the government increased the money supply.
(a)[2]
Define the term factor of production.
(b)[4]
Explain two reasons why workers in building may not become teachers.
(c)[6]
Analyse how a small firm can compete successfully against a large firm in the same industry.
(d)[8]
Discuss whether an increase in the money supply will, or will not, benefit an economy.
Worked solution & mark scheme
This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: “A resource or input for production” …