Answer:
Land, labor, and capital are collectively referred to as the factors of
Production.These factors contribute towards producing goods and services by transforming raw materials into finished products. There are four factors: land, labor, capital, and entrepreneurship.
Economies must address three fundamental economic questions because resources are
Limited.
Before producing goods and services, an economy needs to determine its priorities through three essential questions: What to Produce, How, and For Whom?
Failing to resolve these questions could lead to resources potentially running out.
Since resources in an economy are scarce, addressing the aforementioned questions is crucial for effectively channeling resources towards the most productive uses. Otherwise, resource depletion may occur.
If an economy neglects these questions, it could face negative outcomes that may result from resource shortages, diminishing production, and adversely impacting the population's welfare.
