PRODUCTION: MEANING, TYPES, EFFECTS, FACTORS—BY INSTRUCTOR OKOYE EUNICE.
MEANING OF PRODUCTION: Production can be defined as the transformation of raw materials into finished goods, exchange and distributed in order to satisfy human wants. Production is not complete until goods get to the final consumers.
TYPES OF PRODUCTION: Production can be classified into the following:
PRIMARY/EXTRACTIVE PRODUCTION: It is the extraction of raw materials from the soil e.g. Fishing, Farming, Mining.
SECONDARY/MANUFACTURING PRODUCTION: At this stage, the raw materials extracted from the soil are changed into finished products. E.g. processed food, houses, roads, cloths, cars etc.
TERTIARY PRODUCTION: This involved the distribution of good produced to the consumers. Those involve are wholesalers, retailers, transporters etc. It deals with both professional and commercial services.
EFFECTS OF PRODUCTION ON THE ENVIRONMENT AND SOCIETY: The effects can be positive or negative.
POSITIVE EFFECTS OF PRODUCTION IN AN ENVIRONMENT:
It makes goods and services available for the people living in such environment.
It improves the standard of living of the people by the provision of social amenities such as good road, waterways, airports etc.
It helps to develop the society where it is located.
It assist in creating employment opportunities for the people living in such an environment.
It helps the people in such an environment to acquire special skills.
NEGATIVE EFFECTS OF PRODUCTION IN AN ENVIRONMENT:
It causes environmental pollution such as smokes and noises.
It pollutes the land e.g. lack of proper disposal of waste product e.g. pure water sachet.
FACTORS OF PRODUCTION: The four factors of production are:
LAND: Land is a free gift of nature. It is one of the oldest factor of production. It includes water, forest, minerals etc. Land is fixed and the reward for land is rent. Land is immobile and subjected to diminishing returns. It has the following importance:
A] land is used for farming-the cultivation of both food and cash crops.
B] It is used for livestock production-rearing animals such as cattle, goat, poultry, sheep.etc.
C] It can be used to obtained loan from the bank as collateral security.
D] Land is used for wildlife conservation.
E] It can be used for residential purpose.
F] Land is the source of minerals like gold, tin, kerosene, petroleum etc.
2. LABOUR: Labour is the human effort put into production. Labour could be skilled, semi-skilled or unskilled. The reward of labour is salary and wages. Labour can be moved from one place to another. It is a human factor of production. It has feeling and cannot be used any how. Labour cannot be predicted. It has the following importance.
A] It is needed in order to operate the machines in factories.
B] Labour provides the required skill needed in production.
C] Labour influences the other factors of production such as capital and land.
D]It helps in the production of goods and services.
3.CAPITAL: Capital is a man made wealth used in production. The reward of capital is interest. It can change its form. Capital is subjected to depreciation. Capital is highly durable. It has the following importance.
A] Capital facilitates production.
B] It can helps in the production of quality goods.
C] It helps to increase the standard of living.
D] Capital attracts investors into business.
4. ENTREPRENEUR/ORGANISTION: This is a factor of production that co-ordinates and organizes all other factors of production for more productive purpose. An entrepreneur is a risk bearer and his reward is profit. He provides capital for the business. He is a decision marker. He employs labour and controls other factors of production. An entrepreneur manage and controls the business.
THE PRODUCER: A producer is someone that manufactures products or goods needed by the consumers. A producer produced goods needed by people. He buys the raw materials needed in bulk for production. He carries out the research on which goods will satisfy the customers need. He sells at a cheaper rate.
CONSUMERS: Consumers are those that make use of the goods produced. Consumers buy the goods from the retailer’s shop for their uses. They locate the retailers shop. They buy at any time daily. They buy in units from the retailer.