Eco (2 - Prod, Econ, Res & Res Allo)

2: PRODUCTION, ECONOMIC RESOURCES AND RESOURCE ALLOCATION

Students should be able to:
1. define “production”;
2. distinguish between production and productivity;
3. define the term “factors of production”;
4. identify the economic resources referred to as “factors of production”;
5. state the rewards of the factors of production;
6. describe the factors of production;
7. identify the costs associated with production;
8. differentiate between short run and long run;
9. distinguish between goods and services;
10. explain the concept of resource allocation;
11. list the types of economic systems;
12. describe the characteristics of each economic system;
13. assess the merits and demerits of each economic system;
14. identify the main types of business organizations in a free market;
15. describe the features of each type of business organization;
16. explain the concept of economies of scale;
17. give examples of economies of scale;
18. explain the concept of diseconomies of scale;
19. outline the advantages and disadvantages of division of labour.

CONTENT
1. Definition of production.
2. Differences between production and productivity.
3. Factors of production: resources, both human and non-human, required to produce goods.
4. Types of economic resources as factors of production:
(a) land;
(b) labour;
(c) capital;
(d) entrepreneurial talent.
5. Rewards of factors of production:
(a) rent;
(b) wages and salaries;
(c) interest;
(d) profit.
6. Description of the factors of production:
(a) Land
  (i) definition;
  (ii) characteristics;
  (iii) types;
  (iv) importance;
  (v) productivity
(b) Labour
  (i) definition;
  (ii) characteristics;
  (iii) functions;
  (iv) division of labour;
  (v) specialization of labour;
  (vi) productivity;
  (vii) efficiency;
  (viii) supply.
(c) Capital
  (i) definition;
  (ii) characteristics;
  (iii) types;
  (iv) accumulation;
  (v) importance as a substitute for labour.
(d) Entrepreneurial Talent: public and private enterprises
  (i) definition;
  (ii) importance;
  (iii) functions.
7. Fixed, variable, total, average and marginal costs.
8. Differences between short run and long run.
9. Goods (tangible) and services (intangible)
10. Resource allocation: what to produce; how much to produce and for whom to produce.

11. Types of economic systems:
(a) traditional (subsistence farming, bartering);
(b) command or planned (socialist);
(c) free or capitalist (market);
(d) mixed (public and private).
12. Characteristics of each economic system in relation to ownership of the factors of production, role
of government and role of the private sector; how each economic system allocates resources.
13. Merits and demerits of each economic system in terms of its efficiency in allocating scarce resources
and in providing goods and services to each sector of the population.
14. Types of business organizations in a free market.
15. Features of each type of business organization.
16. Concept of economies of scale.
17. Technical, Marketing, Financial and Risk-bearing economies.
18. Concept of diseconomies of scale.
19. Advantages and disadvantages of division of labour