Enterprise is factor of production, Why and How? Plz explain it with an appropriate example
Enterprise here means entrepreneur which is the main person earning from the production activity. The factor income in case of entrepreneur is profits which he gets from performing economic activities using the other three factors of production - land, labour and capital. By explanation of factor of production stating that each unit which is giving something in the production is considered as a factor thus entrepreneur is also a factor.
It is actually not enterprise but the services of an enterpreneur that are factor of production. The return given to him is called Profits.
Example: A business is run by an enterpreneur. He offers his services , takes valuable decisions and plans for the success of business. So he is helping in production. That is why he is a factor of production.