Which of the following is an example of capital as a factor of production?

• A. A factory building
• B. A farmer's labor
• C. A plot of land
• D. Raw materials

Answer: (A)

Verified step by step guidance

1. Understand the definition of the factors of production: land, labor, capital, and entrepreneurship. Capital refers to man-made resources used in the production of goods and services.
2. Identify each option and classify it according to the factors of production: a factory building is a man-made resource used to produce goods, a farmer's labor is human effort, a plot of land is a natural resource, and raw materials are inputs but not capital themselves.
3. Recall that capital includes physical assets like machinery, tools, and buildings that aid production but are not consumed in the production process immediately.
4. Recognize that a factory building fits the definition of capital because it is a physical, man-made asset used to produce other goods.
5. Conclude that among the options, the factory building is the example of capital as a factor of production.