Why money is not considered as factor as production?

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2026-07-23 08:00

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Money is not a factor of production in economics because it is used as a way to facilitate trade, but does not actually produce goods or services on its own. Money is not considered a factor of production because it cannot be made into a good or service. It can only purchase them.

Money facilitates trade, but it is not in itself a productive resource. A factor of production is an input to the production process, such as capital. Money is not capital as economists define capital, because it is not a productive resource.

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