Factors of production include resources that may be defined as inputs, primarily consisting of land, labour and capital to produce an output, for all express purposes to produce a finished product.
This may be defined as value adding as the raw materials are improved at stages along the length of the process. Entrepreneurship is the process of starting and managing the business process adding value whilst undertaking risk to generate a profit.
A primary resource such as iron ore is mined in Western Australia, contrary to what many people think, a high degree of technology is utilised in the mining process. The ore is then stockpiled on site where the primary product undertakes primary finishing.
This involves crushing the raw ore to fines and mixing and blending grades of ore. The crushed product is loaded onto trains and transported to ports on the coast for shipping internationally to mills.
Fixed costs may include mining leases, milling costs and shipping via train and marine. To a degree, milling and screening costs are relatively fixed as with shipping via train and bulk ore carrier.
The cost of a crew for the train or ship is the same regardless of whether the train and ship are half full or fully loaded, increasingly these modes of transport require minimal crew.
The process of mining is very equipment intensive, no longer do men physically dig rocks, instead large scale machinery is utilised; as such, I am grouping machine mining into the labour component.
To increase productivity, larger more efficient machines are utilised, a variable input. In order to dig and load ore more effectively, no further personnel are required to operate a larger more efficient digging machine although operating and maintenance costs usually increase.
Technology gains have allowed the manufacture of larger machines, it is inefficient to merely increase the number of smaller machines due to congestion, access to ore haul roads.
Utilising the optimal size and number of digging machines and trucks, the cost curve slopes downward until diminishing returns cause an upkick in the curve from inefficiencies.
The raw ore is loaded onto larger trucks for transport to the primary crusher, once again, productivity is improved by larger trucks although only one driver per machine is used.
Increasingly, trucks are now becoming autonomous being driven via computer in Perth, trains will be next when union opposition is overcome with the loading facilities using minimal staff.
Even with autonomous truck design, only one driver is required, costs are reduced as although the technology initially costs more to design and implement but is achieved through wages and living in in remote areas with the costs involved.
The ore is then carried by conveyor belt through a series of crushers that progressively crush the ore to various sizes before screening and stockpiling. The ore is delivered to international mills where the primary milled ore is fed into furnaces and converted to steel.
The finished steel is then sold to produce products such as automobiles, bridges, mining equipment and crushing plants. At all stages of the process, the raw product been improved and value added.
This may be defined as value adding as the raw materials are improved at stages along the length of the process. Entrepreneurship is the process of starting and managing the business process adding value whilst undertaking risk to generate a profit.
A primary resource such as iron ore is mined in Western Australia, contrary to what many people think, a high degree of technology is utilised in the mining process. The ore is then stockpiled on site where the primary product undertakes primary finishing.
This involves crushing the raw ore to fines and mixing and blending grades of ore. The crushed product is loaded onto trains and transported to ports on the coast for shipping internationally to mills.
Fixed costs may include mining leases, milling costs and shipping via train and marine. To a degree, milling and screening costs are relatively fixed as with shipping via train and bulk ore carrier.
The cost of a crew for the train or ship is the same regardless of whether the train and ship are half full or fully loaded, increasingly these modes of transport require minimal crew.
The process of mining is very equipment intensive, no longer do men physically dig rocks, instead large scale machinery is utilised; as such, I am grouping machine mining into the labour component.
To increase productivity, larger more efficient machines are utilised, a variable input. In order to dig and load ore more effectively, no further personnel are required to operate a larger more efficient digging machine although operating and maintenance costs usually increase.
Technology gains have allowed the manufacture of larger machines, it is inefficient to merely increase the number of smaller machines due to congestion, access to ore haul roads.
Utilising the optimal size and number of digging machines and trucks, the cost curve slopes downward until diminishing returns cause an upkick in the curve from inefficiencies.
The raw ore is loaded onto larger trucks for transport to the primary crusher, once again, productivity is improved by larger trucks although only one driver per machine is used.
Increasingly, trucks are now becoming autonomous being driven via computer in Perth, trains will be next when union opposition is overcome with the loading facilities using minimal staff.
Even with autonomous truck design, only one driver is required, costs are reduced as although the technology initially costs more to design and implement but is achieved through wages and living in in remote areas with the costs involved.
The ore is then carried by conveyor belt through a series of crushers that progressively crush the ore to various sizes before screening and stockpiling. The ore is delivered to international mills where the primary milled ore is fed into furnaces and converted to steel.
The finished steel is then sold to produce products such as automobiles, bridges, mining equipment and crushing plants. At all stages of the process, the raw product been improved and value added.
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