The correct option is 2 only.
Explanation
A capitalist enterprise is an economic unit where the entrepreneur organizes factors of production-land, labour, and capital-to produce goods or services with the primary motive of earning profit. The production process relies on the integration of these inputs.
Statement-wise Analysis:
- Statement 1 is Incorrect: Production in any economic system, including a capitalist enterprise, fundamentally requires natural resources (often categorized as 'Land' in economics) and raw materials. It is impossible to produce physical goods without material inputs. Even service-oriented enterprises require physical infrastructure and resources.
- Statement 2 is Correct: Human labour is a primary factor of production. It involves the physical and mental effort provided by workers to transform raw materials into finished products or to deliver services.
- Statement 3 is Incorrect: In a capitalist system, the entrepreneur is not prohibited from borrowing capital. On the contrary, financial markets and institutions play a crucial role by lending capital to entrepreneurs for investment in machinery, infrastructure, and operations. Borrowing is a standard practice to finance business activities.
Key Takeaway:
The four essential factors of production in an economy are Land (natural resources), Labour (human effort), Capital (machinery and finance), and Entrepreneurship (organization and risk-taking).