Economics UnitEconomics Unit

MoneyMoney

How do you think money is made? How do you think money is made?

Where do you think it is made? Where do you think it is made?

Let’s watch to answer these questions! Let’s watch to answer these questions!

The Birth of a Coin videoThe Birth of a Coin video

IncomeIncome The money people earn when they work. The money people earn when they work.

How many of you earn an income at home? How do How many of you earn an income at home? How do you earn it? What do you do with the money you you earn it? What do you do with the money you earn? earn?

Do you have a saving account for the money?Do you have a saving account for the money?

We are going to read about a boy who receives We are going to read about a boy who receives money, but just can’t seem to make wise choices money, but just can’t seem to make wise choices about saving it. about saving it.

GoodsGoods

Items that people make or use Items that people make or use to satisfy needs and wantsto satisfy needs and wants

Ex. toys, food, a computer, Ex. toys, food, a computer, shoesshoes

What goods can you name in What goods can you name in the classroom? the classroom?

ServicesServices Activities that satisfy people’s needs and wants

Ex. Haircuts, doctor exams, opening a savings account

Hairdressers, doctors, and bankers provide these services for us.

Who provides services for you in our school?

Teachers help us learn, cafeteria workers serve us lunch, custodians clean our school, librarians provide books

Understand Goods and Services? Understand Goods and Services?

We are going to put you to the test! We are going to put you to the test!

Goods or Services?Goods or Services? Goods and Services ActivityGoods and Services Activity

Specialized JobsSpecialized Jobs Last week, we talked about goods and services. Some Last week, we talked about goods and services. Some

workers make the goods for people to buy while other workers make the goods for people to buy while other workers provide a service. workers provide a service.

People that provide services and are trained to do a People that provide services and are trained to do a certain kind of job have a specialized job. A few certain kind of job have a specialized job. A few examples would be lawyers, doctors, and firefighters. examples would be lawyers, doctors, and firefighters.

Who has a specialized job in our school? Who has a specialized job in our school? Principals, teachers, secretaries, school nursePrincipals, teachers, secretaries, school nurse

Workers in Our Workers in Our CommunityCommunity

Think about workers in our community. Think about workers in our community. Are they making goods or providing Are they making goods or providing services? services?

Let’s make a chart!Let’s make a chart!

How do service jobs and jobs where How do service jobs and jobs where people sell things help our community? people sell things help our community?

Consumers or ProducersConsumers or Producers

Consumers are people who buy goods Consumers are people who buy goods and services to satisfy their wants.and services to satisfy their wants.

Producers are people who make goods Producers are people who make goods or provide services. or provide services.

Label each business on your chart either Label each business on your chart either a consumer or producer. Did you know a consumer or producer. Did you know that some of them are both? that some of them are both?

Mystery Worker RiddlesMystery Worker RiddlesFire! Fire!Fire! Fire!

9-1-19-1-1

I fight the blaze until it’s done.I fight the blaze until it’s done.

Who am I? _____ Who am I? _____

A firefighterA firefighter

I get up earlyI get up early

Just to bakeJust to bake

Your cookies, rollsYour cookies, rolls

And bread and cake.And bread and cake.

Who am I? _____ Who am I? _____

A bakerA baker

Stitches and itches,Stitches and itches,

Slips and falls,Slips and falls,

Colds and flu,Colds and flu,

I fix them all.I fix them all.

Who am I? _____ Who am I? _____

A doctorA doctor

I’m there for youI’m there for you

Both night and dayBoth night and day

So you are safeSo you are safe

At school and play.At school and play.

Who am I? _____ Who am I? _____

A policemanA policeman

Productive ResourcesProductive Resources

These are the things needed to produce These are the things needed to produce (make) goods. (make) goods.

There are three main productive There are three main productive resources: capital, natural, and human. resources: capital, natural, and human.

Capital ResourcesCapital Resources Goods made by people and used to make Goods made by people and used to make

other goods or to provide services.other goods or to provide services.

Examples: any kind of machines such as a Examples: any kind of machines such as a computer, blender, hammercomputer, blender, hammer

What capital resources do we have in our What capital resources do we have in our school? school?

pencils, scissors, table, chairpencils, scissors, table, chair

Natural ResourcesNatural Resources Gifts of nature that are untouched by human handsGifts of nature that are untouched by human hands They can be used to produce goods we want.  They can be used to produce goods we want.   Items made with the help of a machine is not a Items made with the help of a machine is not a

natural resource. natural resource.

Examples are: Examples are: sunlight, trees, land, coal, oil, water, sunlight, trees, land, coal, oil, water, oranges, flowersoranges, flowers

What natural resources do we have at our school? What natural resources do we have at our school?

Human ResourcesHuman Resources

People who work to make a product or provide a People who work to make a product or provide a service. service.

Examples: doctors, truck drivers, and farmers.Examples: doctors, truck drivers, and farmers.

What human resources do we have at our What human resources do we have at our school? school?

Teachers, principals, custodians, secretariesTeachers, principals, custodians, secretaries

Let’s Review!Let’s Review! Can you find the capital, human, and natural Can you find the capital, human, and natural

resources on a construction site? resources on a construction site?

Construction Site ActivityConstruction Site Activity

Do you understand the three types of resources?Do you understand the three types of resources?

Let’s watch the production (making) of Crayola Let’s watch the production (making) of Crayola

crayons. Looks for natural, capital, and human crayons. Looks for natural, capital, and human

resources in the video. resources in the video.

Crayon production videoCrayon production video

PricePrice

The amount people (consumers) pay The amount people (consumers) pay when they buy a good or service.when they buy a good or service.

The amountThe amount people (producers) people (producers) receive when they sell a good or receive when they sell a good or service. service.

ProfitProfit

The difference between the amount of The difference between the amount of money they made and spent.money they made and spent.

Example: You buy a shirt for $6 and Example: You buy a shirt for $6 and sell it to your friend for $10. Your sell it to your friend for $10. Your profit would be $4. profit would be $4.

Lemonade Stand Productive Lemonade Stand Productive ResourcesResources

Pretend you are going to start your own Pretend you are going to start your own lemonade business. lemonade business.

What human resources will you need? What human resources will you need?

You!You!

What capital resources will you need? What capital resources will you need?

pitcher, spoons, table, signpitcher, spoons, table, sign

What natural resources will you need? What natural resources will you need?

lemons, sugar, water, icelemons, sugar, water, ice

You’re in Business!You’re in Business! How well do you think you would do running How well do you think you would do running

your own lemonade business? your own lemonade business? You will get to set your own prices and see if You will get to set your own prices and see if

you can make a profit (money). you can make a profit (money). Let’s do the first day together. Let’s do the first day together.

Lemonade StandLemonade Stand

Did you earn a profit?Did you earn a profit?

Consumer or Producer?Consumer or Producer?

Who was the consumer of your lemonade Who was the consumer of your lemonade stand? stand?

Remember consumers are people who buy Remember consumers are people who buy goods and services to satisfy their wants.goods and services to satisfy their wants.

Who was the producer of your lemonade Who was the producer of your lemonade stand? stand?

Remember producers are people who make Remember producers are people who make goods or provide services. goods or provide services.

BarteringBartering Bartering is trading without using money. Before money was invented, people would barter to get

the things they needed that they couldn’t get for themselves.

Look at the men bartering in the picture. They are exchanging or swaping without using money. One man

needs a pair of boots and the other one needs food. Each one is happy with the trade and thinks they got an item

better than the one they had before.

Want to try bartering? Want to try bartering? Write an item that you have at home that you might like to Write an item that you have at home that you might like to

barter. You will not really be giving this item away. This is barter. You will not really be giving this item away. This is just pretend. It can be an item of high value (iPod, bed, just pretend. It can be an item of high value (iPod, bed, camera) or lower value (sunglasses, bookbag, blanket). camera) or lower value (sunglasses, bookbag, blanket).

Listen to the items your classmates are bartering. Decide Listen to the items your classmates are bartering. Decide which item you would like the most. which item you would like the most.

Now you will have a chance to start bartering with your Now you will have a chance to start bartering with your classmates. classmates.

Always think about whether the exchange would give an Always think about whether the exchange would give an item that is better than you started with. You must item that is better than you started with. You must participate in 4 exchanges, but you don’t have to accept participate in 4 exchanges, but you don’t have to accept all of them. all of them.

Let’s see if you end up with the item you wanted. Good Let’s see if you end up with the item you wanted. Good luck!luck!

Is bartering or trading easier? Is bartering or trading easier? How many of you ended up with the item that you wanted? How many of you ended up with the item that you wanted? Did you think it was easy to barter?Did you think it was easy to barter? Did anyone have someone that didn’t want to exchange Did anyone have someone that didn’t want to exchange

items with you? items with you? Imagine having to use bartering all of the time. If you wanted Imagine having to use bartering all of the time. If you wanted

to bake a cake and didn’t have flour, you would have to find to bake a cake and didn’t have flour, you would have to find someone that was willing to barter with you. Sometimes someone that was willing to barter with you. Sometimes people would not want to exchange, so you couldn’t get the people would not want to exchange, so you couldn’t get the flour. flour.

Now if we need flour, we go to the store and buy it. This is Now if we need flour, we go to the store and buy it. This is trading because we are using money. trading because we are using money.

It is faster and easier to use money to get the goods and It is faster and easier to use money to get the goods and services we need. services we need.

With bartering, we talked about With bartering, we talked about not always having all the things not always having all the things we want because of scarcity we want because of scarcity (not enough of something).(not enough of something).

When this happens, we have to When this happens, we have to make choices.make choices.

When we choose, whatever we When we choose, whatever we give up is the give up is the opportunity opportunity costcost. .

1. What are the girl’s two choices?

2. Why can’t she have both?

3. What is the opportunity cost if she chooses the skateboard?

The ticket

4. What is the opportunity cost if she chooses the ticket?

The skateboard

Skateboard or ticket

Scarcity of money

Oh Give Me a Choice (Tune: Oh Give Me a Choice (Tune: Home on the Home on the RangeRange))

Oh give me a choice,Oh give me a choice,Oh, a difficult choice,Oh, a difficult choice,And I’ll think about what I could use.And I’ll think about what I could use.I’ll have to decide,I’ll have to decide,With my eyes open wide,With my eyes open wide,What I’ll give up and what I will choose.What I’ll give up and what I will choose.Opportunity cost!Opportunity cost!It’s the thing you give up when you choose.It’s the thing you give up when you choose.It’s the price that is paidIt’s the price that is paidWhen a choice must be made.When a choice must be made.It’s the thing that I surely will lose.It’s the thing that I surely will lose.