FACTORS OF PRODUCTION CONTD
Hello Everyone, Happy Friday. Thank
God It's FRIDAY!!!!!.... LOLZ, Yes the last working day of the week and then
rest rest rest!!!... There's time for HARD WORK and also time for REST... Pls
Make Sure you Balance the Two Very Essential. Straight to the Point of the Day
CAPITAL CONSUMPTION refers to the using up of existing capital stock and
not replacing worn-out capital goods used in production. When fixed assets like
Buildings, Machinery or Motor Vehicle are used continuously, they undergo wear
and tear, hence such assets depreciate in value. It is this wear and tear of
these capital goods which reduces their value which is referred to in Economics
as CONSUMPTION or DEPRECIATION.
During the period of Capital
Consumption, enough savings are not made to maintain and replace depreciating
capital goods or assets. If a Country finds it difficult to maintain its stock
of capital, either by making provision for depreciation or her inability to
replace worn-out capital or asset, such a country is said to be living on
capital or consuming capital and this affects the standard of living of the
people negatively.
ENTREPRENEUR
An Entrepreneur can be defined as
the factor of production that co-ordinates and organises other factors of
production( Land, Labour and Capital) in order to produce goods and services.
The
