Chapter 18 went in-depth about factors of production. The three main ones mentioned are land, labor, and capital. Labor are the hired workers who receive wages for working. Land is the physical spaced use to produce but land can be differentiated whether it's bought at a purchase price or paid at a rental price in which rental price is paying for a temporary period of time. Capital is the stock of equipment and structures used for production.
The book explains marginal product, value of marginal product, and brings back the term of diminishing marginal product. For a competitive market to maximize their profits, the wage has to equal the value marginal product of labor. This goes for land and capital. Land with a purchase price or rental price, their price has to equal the value of marginal product of the land. Value of marginal product is of any input is the marginal product of that input multiplied by the market price of that output. The book provided with some decent examples such as the apple orchard and I think I understand the big picture concepts but I may need to review the specifics and terms. The demand schedules were helpful. I would rate this chapter a difficulty rating of 2/3.
