The key distinction between a factor of production and an input is that:
A)an input is an enduring source of income, but a factor of production is used up in the production process.
B)a factor of production earns income from selling its services over and over again but an input cannot.
C)an input earns income from selling its services over and over again but a factor of production cannot.
D)a factor of production has limited earning potential.

Question

Quizplus · Accepted Answer

A factor of production (such as labor or capital) is a resource used in the production process, while an input is any material or resource that is used to produce goods or services. The key distinction is that a factor of production can be used repeatedly to produce income, while an input may only be used once or for a limited time. For example, a worker is a factor of production who can provide labor services multiple times over their lifetime, earning income each time, while a piece of machinery is an input that can only be used to produce a finite amount of goods before needing to be replaced. Therefore, choice B is the correct answer.

The Key Distinction Between a Factor of Production and an Input