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Macro Econ Essay 1


Submitted By jaredstiers4
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Factors of production means inputs and finished goods means output. Input decides the quantity of output, and output depends upon the input. Input in the starting point and output is the finishing point of the production process. The resources used are factors of production such as land, labour, capital, and entrepreneur. These resources all cycle to create production and in turn will create an input, output process.
An example of land would be anything from owning a farm house to having a landlord. Both have tangibles and variables that dictate the input and output. A landlord for example would collect rent and create a natural output. Labour is the activity of one individual accomplishing work. A labour also creates a natural output due to the input of oneself. Capital is the total net worth, this input is used upon variables such as money lending or investing and is a man made output due to the specifics or circumstances regarding the capitol. Lastly entrepreneur, it is the creation of oneself through ownership of a business. This input is also man made due to variables that can dictate the output. An example would be up front capitol, also factors such as business plan, location, current market. Many variables come into play regarding entrepreneur and the output of such is completely determined upon human, not natural circumstances.
The impact of oil prices throughout the economy is astonishing. The dependency we have as an economy of oil is unfathomable. To simply state it, the more the economy flourishes the more productivity and activity throughout that economy. Well in retrospect, due to the high volume of production, this in turn creates more use of oil and more use then creates higher prices for oil itself. It is somewhat of an oxymoron, when economies flourish, oil companies flourish due to high demand and higher pricing.

When the economy

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