What are the four essential factors of production?

Land, Labor, Capital, Entrepreneurship

In economics, production refers to the process of utilizing resources to transform them into ______.

Commodities and services

True or False: Production can only involve the creation of tangible goods.

False. Production also includes the provision of services.

Which characteristic of land indicates that its supply is fixed and cannot be increased?

Fixed Supply

Riddle: I am a factor of production that cannot be moved and is essential for creating wealth. What am I?

Land

What is the primary economic significance of labor?

It is performed with the intention of earning an income.

Fill in the blank: The ______ is the part of a person's or community's wealth used to create more wealth.

Capital

Which type of capital is considered durable and provides services over time?

Fixed Capital

True or False: The willingness to save is not important for capital formation.

False. Willingness to save is crucial for capital formation.

What is the reward for labor as a factor of production?

Wages

Which function of an entrepreneur involves introducing new ideas or inventions to meet business needs?

Innovations

Fill in the blank: The principle of ______ suggests that the marginal revenue product of labor should equal the marginal wages.

Marginalism

What is the relationship between average product (AP) and marginal product (MP) when AP is at its maximum?

MP equals AP.

Riddle: I change the form of resources to create value, but I do not create matter from scratch. What am I?

Production

In the short run, which factor is typically treated as fixed in the production function?

Capital

What does the Cobb-Douglas production function illustrate?

The contributions of labor and capital to production.

True or False: Increasing returns to scale occur when output increases by a smaller proportion than the increase in inputs.

False. Increasing returns to scale occur when output increases by a greater proportion than the increase in inputs.

Fill in the blank: The law of ______ states that adding more of a variable input to a fixed input will eventually yield smaller increases in output.

Diminishing returns

What is the reward for entrepreneurship as a factor of production?

Profit

What is the term for the various combinations of two factors a firm can purchase within a given budget?

Isocost or Equal-cost Lines