Business Environment

Describe the role of business in the economy, including the factors of production and the key dimensions of the business environment.

Business is the engine that drives the economy, providing jobs, purchasing raw materials from producers, and providing the products and services that all consumers use, improving the value of life for everyone in the environment. The income of the economy is distributed through the factors of production. The three main factors of production are labor, land, and capital (Mankiw, 2012, p.393). Companies employ many people, providing jobs and money for the economy through labor. Companies will continue to demand more labor until the cost begins to outweigh the value of this production factor. This is an important factor because these employees are also consumers who pump most of the money they receive right back into the economy in one way or another. Companies need available land, both...
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