(a) The two factors that determine the division of labour are:
1. Size of the market: The extent to which division of labour can be adopted, depends upon the size of the market for a particular product. The concept of market includes the area or region, number of buyers and their purchasing power etc.
2. Attitude of workers: Divisions of labour becomes useful and beneficial when the workers have willingness and positive attitude towards it.
(b) Land differs from other factors of production:
1. As it is a free gift of nature and is available free of cost.
2. Supply of land is fixed in quantity. It cannot be increased or decreased like other factors of production.
(c) “An indirect tax is a tax which is demanded from one person in the expectation and intention that he shall indemnify himself at the expense of another.”
For example: Excise duty, custom duty, sales tax etc.
(d) 1. A professor working in a college: He is considered as labour in economics. He comes under the category of professional labourer. He is that mental worker, who has undergone advanced study and training.
2. A social worker serving in an orphanage: He is not considered as labour as neither he performs ‘mental’ nor ‘physical’ exertion with a motive to earn money.
(e) Capital is the core of economic development. It is not possible without a sufficient provision of machines, tools, irrigation system, dams, bridges, railways etc. All nations need adequate capital stock for their economic development.
