Certified Pennsylvania Evaluator Practice Exam

Which of these is NOT considered an agent of production?

1. Labor

2. Land

3. Taxation

4. Management

The correct answer is: Taxation

Taxation is not considered an agent of production because it does not directly contribute to the creation of goods or services. The agents of production typically include labor, land, and management, all of which play essential roles in the production process. Labor refers to the human effort that is used in the production of goods and services. It encompasses the workforce needed to design, build, or render services that satisfy consumer demand. Land represents the natural resources that are used in production, including physical land, raw materials, and other resources provided by nature. Management is the strategic direction and oversight provided to coordinate the other agents of production effectively. In contrast, taxation is a financial obligation imposed by governments on individuals and businesses, and while it may impact the economy and the resources available to businesses, it does not have a direct role in the physical process of producing goods or services. Therefore, it does not fit as an agent of production.