Question

Which function of an entrepreneur allows him to decide the reward that each factor of production should get?

Options

• Innovative function

• Distributive function

• Risk wearing

• Decision-making function

Answer 1

Distributive function

Explanation:

• The distributive function of an entrepreneur involves determining how the total income generated by a business is allocated among the various factors of production, including land, labour, and capital.
• This function allows the entrepreneur to decide the reward or compensation for each factor based on its contribution to production.