factor market

Factor Market

The market for the means of production. That is, the factor market is the buying and selling of land, labor and capital, as well as raw materials and entrepreneurship. The most important component of the factor market is labor. See also: Factor Income.

factor market

a market in which FACTORS OF PRODUCTION are bought and sold and in which the prices of labour and other FACTOR INPUTS are determined by the interplay of demand and supply forces. See LABOUR MARKET, CAPITAL MARKET, COMMODITY MARKET, DERIVED DEMAND, MARGINAL PHYSICAL PRODUCT, MARGINAL REVENUE PRODUCT, PRICE SYSTEM. factors of production the resources that are used by firms as FACTOR INPUTS in producing a good or service. There are three main groups of factor inputs: NATURAL RESOURCES, LABOUR and CAPITAL.

Factors of production can be combined together in different proportions to produce a given output (see PRODUCTION FUNCTION); it is assumed in the THEORY OF THE FIRM that firms will select that combination of inputs for any given level of output that minimizes the cost of producing that output (see COST FUNCTION). See ENTREPRENEUR, MOBILITY.

单词	factor market
释义	factor market Factor Market The market for the means of production. That is, the factor market is the buying and selling of land, labor and capital, as well as raw materials and entrepreneurship. The most important component of the factor market is labor. See also: Factor Income. factor market a market in which FACTORS OF PRODUCTION are bought and sold and in which the prices of labour and other FACTOR INPUTS are determined by the interplay of demand and supply forces. See LABOUR MARKET, CAPITAL MARKET, COMMODITY MARKET, DERIVED DEMAND, MARGINAL PHYSICAL PRODUCT, MARGINAL REVENUE PRODUCT, PRICE SYSTEM. factors of production the resources that are used by firms as FACTOR INPUTS in producing a good or service. There are three main groups of factor inputs: NATURAL RESOURCES, LABOUR and CAPITAL. Factors of production can be combined together in different proportions to produce a given output (see PRODUCTION FUNCTION); it is assumed in the THEORY OF THE FIRM that firms will select that combination of inputs for any given level of output that minimizes the cost of producing that output (see COST FUNCTION). See ENTREPRENEUR, MOBILITY.
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