Organisation of production


 
 
Concept Explanation
 

Organisation of production

Organisation of production: Production is an activity which gives the required goods and services. This requires four elements, which are called factors of production. The factors are

1. Land and other natural resources like water, minerals, forests etc.

2. Labour for carrying out the production activity. Some activities may be done by manual workers while others may require highly skilled or educated persons.

3. Physical capital includes two sub-components

(i) Fixed capital Assets or capital investments that are needed to start production of goods or services. It includes buildings, machines, tools, ranging from plough to generators, turbines, computers, etc. These can be used in production over many years, thus are fixed in nature.

(ii) Working capital Raw materials and money in hand are used at the time of production activities i.e., to purchase raw materials and services required and to sell finished goods.

4. Human capital is the knowledge and enterprise. It is required to put together all the above inputs to produce the output. Now, this output can either be sold in the market or used by the person producing the output.

Kharif Crops: The autumn crop sown at the beginning of summer rains.

Rabi Crops:  The spring crop sown in winter.

 
 


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