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Appendix B
Student Worksheets
The following student worksheets cover many of the concepts introduced in this booklet. Some of the simpler worksheets can be used with primary students, while more complicated worksheets are more appropriate for older students. Answers for selected questions are located at the end of the Appendix.
Goods or Services?
1. In the blanks below put G if the item is a GOOD and put S if the item is a SERVICE.
______ haircut ______ book
______ pear ______ paper cup
______ mowing lawns ______ teaching students
______ chair ______ painting house
______ washing car ______ car
______ fixing TV’s ______ boat
______ pencil ______ typing letters
______ shirt ______ playground ball
______ cleaning teeth ______ rake
______ shining shoes ______ raking leaves
2. Explain the difference between a GOOD and a SERVICE.
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
3. How do we get GOODS and SERVICES?
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
4. Draw a picture of someone performing a service.
Which Things Are Scarce?
Background Information: In economics, a good or service is considered SCARCE if
there is not enough for everyone to have all that he or she wants – at a price of zero! With
this definition, almost everything is scarce. Few things are truly free.
1. Circle the things below that, in economics, are considered scarce.
Hamburgers Gold Ring Bed Sunshine
Pencil Air You Are Breathing
Teaching Saltwater At The Beach Oak Tree
Air Under Water Chocolate Cake
Shirt Water A Nurse’s Services
Sand in the Desert TV Repair Services
2. In economics, anything with a price is considered scarce. In fact, it is the price that
determines who gets to have the scarce thing. As you might expect, the higher the price,
the more scarce something is. Of the scarce items you circled above, put a red line under
the item you think is the most scarce. Put a green line under the thing you think is the
least scarce.
3. Can something be valuable and yet not be “scarce?” Explain and give an example.
(Hint: Examine the items in the box above!)
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
Choices Have Costs
When you make a choice, the most valuable alternative you do not choose is your OPPORTUNITY COST. There is an opportunity cost to every economic decision.
- You have just received $10 for a birthday present. You decide to buy either a soccer ball, a large box of candy, or a teddy bear. Put a 1 under the good you will buy. Put a 2 under your second choice, and a 3 under your third choice.
- What is the opportunity cost of your decision? ____________________________________
- Suppose your friend has the same first choice as you. Does this mean his or her opportunity cost is the same as yours? Why or why not?
- Betsy has 1 hour until bedtime. She can read a book, play a game, or bake a cake. She decides to play a game. Her second choice is to read a book, and her third choice is to bake a cake.
What is the opportunity cost of her decision? _____________________________
Can Betsy’s opportunity cost be reading the book and baking a cake? Why or why not?
Who Provides the Service?
1. Use a red crayon to circle services provided by the GOVERNMENT. Use a green
crayon to circle services provided by PRIVATE BUSINESSES.
TV Repair Police Protection Taxi Service
Street Lights Library
Water Service Car Wash Army and Navy
Garbage Collection Court System Firefighter
2. Underline two services above which are provided by government and by private
businesses.
________________________________________________________________________
________________________________________________________________________
3. Where does the government get the money to provide services?
4. What are some of the different types of taxes that governments collect?
________________________________________________________________________
________________________________________________________________________
5. Interview your parents, relatives, or neighbors about their work. Find out: (1) if they
produce a good or service and (2) w hether they work for government or a business. With
the help of your teacher, use the data gathered from all your classmates to make charts or
graphs illustrating your interview results.
Services — Public or Private?
People want many kinds of services. Governments collect taxes to provide some services.
Private businesses also provide many services. Some services are provided by both
government and private businesses.
1. Directions: Put an X in one of the three blanks to show how each service is typically
provided.
Government Private Business Both Government
& Private Business
a. Fire Protection __________________ __________________ __________________
b. TV Repair __________________ __________________ __________________
c. Snow Removal __________________ __________________ __________________
d. 1st Class Mail __________________ __________________ __________________
e. National Defense __________________ __________________ __________________
f. Education __________________ __________________ __________________
g. Haircuts __________________ __________________ __________________
h. Lawn Mowing __________________ __________________ __________________
i. Mailing Packages __________________ __________________ __________________
j. Police Protection __________________ __________________ __________________
k. Garbage Collection__________________ __________________ __________________
l. Street Cleaning __________________ __________________ __________________
2. Why is national defense something that cannot be provided very well by private
business?
________________________________________________________________________
________________________________________________________________________
3. Which government service do you think is most important? Why?
________________________________________________________________________
________________________________________________________________________
Money
Most of the following items have been used as money at some time in history. Some items have worked better than others. Ideally, money should have four characteristics. It should be scarce, durable, divisible, and portable. Discuss what these mean.
- Put a plus (+) in the blank if an item fits one of the characteristics of money very well. Put a zero (0) if the item fits somewhat. Put a minus (-) if it does not fit very well at all. The first one has been done for you. Characteristics SCARCE DURABLE PORTABLE DIVISIBLE
Shells _______^0 _______+^ _______+^ _______-
Gold _______ _______ _______ _______
Beads _______ _______ _______ _______
Paper _______ _______ _______ _______
Tobacco _______ _______ _______ _______
Furs _______ _______ _______ _______
Silver _______ _______ _______ _______
Corn _______ _______ _______ _______
Pebbles _______ _______ _______ _______
- Which item above do you think would be best for money? ____________________________
Why? ________________________________________________________________________
- Which item above do you think would be worst for money? ____________________________
Why? ________________________________________________________________________
- Throughout history, which item do you think has been used most for money? ______________
Why? ________________________________________________________________________
Working More Efficiently
Productivity measures how efficiently we use our productive resources to produce goods and services. We can increase productivity by using:
1. Better Technology (i.e. improved capital) - T 2. Education and Training (better human capital) - E 3. Specialization - S
- How can productivity be increased in the situations below? Put T, E, or S in the blanks to represent the four ways above. NOTE: Some situations have more than one way to increase productivity.
a. A farmer plants a field with a hoe. _______ b. Five shoemakers each produce complete pairs of shoes using simple hand tools. _______ c. A dentist meets patients, makes appointments, cleans teeth, and does fillings. _______ d. It takes a long time for five workers to unload boxes from a truck. _______ e. Painters paint only one house every two weeks. _______ f. College students make many mistakes and take a long time doing difficult math problems using pencil and paper. _______ g. Workers in a computer repair shop are not fixing many computers each day. _______ h. In a hamburger restaurant, each worker takes orders, cooks hamburgers, gets drinks, and wipes tables. _______ i. It takes a long time for mechanics in a repair shop to fix cars. _______ j. Three boys each have their own lawn business. They use push mowers, rakes, and small weeding tools. _______
- Sometimes improving technology, such as adding new machines to a production process, results in some workers no longer being necessary. Even if it helps increase productivity, do you think business owners should substitute machines for workers? Write a paragraph on the back expressing your view.
Lemonade Stand
Jerry and Sam want to earn a PROFIT by selling lemonade. In the chart below are costs
for the ingredients to make one glass of lemonade.
1. How much do the ingredients cost to make one glass of lemonade?
2. If the boys sell each glass for a price of .60, how much profit will they make? What if
the price is .70?
3. If they charge .60 and sell 8 glasses, how much profit will they make altogether? If they
sell 10 glasses?
4. What is another other important productive resource cost that the boys are not consider-
ing when computing their profit?
5. What are some capital resources that the boys need for their business, which they will
probably borrow from their families?
Cost of Ingredients Lemon. Sugar. Paper Cup.
The Birdhouse Business
Jeff plans to make and sell birdhouses this summer. Below is the cost of materials for each bird- house. He knows he can make 10 birdhouses each week and that he can sell them for $14.00 each.
- What is the cost of materials for each birdhouse? _____________________________________
- How much profit will he make on the sale of each birdhouse? _________________________
- How much profit will he make each week by selling all 10 birdhouses? __________________
Jeff’s uncle offers him a summer job mowing 10 lawns a week. Jeff will earn $100 each week for his wages.
- How much more money would Jeff earn mowing lawns each week
instead of making birdhouses? ____________________________________________________
- Given this new information, is Jeff still making a “profit” by making birdhouses?
Why or why not? ______________________________________________________________
- What is Jeff’s opportunity cost if he chooses to mow lawns? __________________________
- What is Jeff’s opportunity cost if he chooses to make birdhouses? ______________________
- If Jeff chooses to make birdhouses, is he making an unwise decision? Why or why not?
Wood 6. Paint. Screws.
How Many Cookies?
(Supply)
Mrs. Mills’ students are still trying to figure out how many cookies to produce. Their market survey told them about demand, but now they need to analyze their SUPPLY. Some students do not want to make many cookies and will do so only if they are paid higher wages. The class, therefore, would have to charge higher cookie prices to cover any increases in production. The class supply schedule is given below.
- At what price would the class supply the most cookies? ____________ The least? __________
- As the price goes up, what happens to the quantity supplied? ____________________________
Why? ________________________________________________________________________
- As the cookie price goes down, what happens to the quantity supplied? ____________________
Why? ________________________________________________________________________
- Graph the class supply schedule below. Connect the points.
Supply of Cookies Price
Quantity of Cookies Supplied
Class Supply Schedule
Price per Cookie Quantity of Cookies Class Would Supply .50 1000 .40 700 .30 400 .20 250 .10 100
How Many Cookies?
(Supply and Demand)
Mrs. Mills’ class is finally ready to decide how many cookies to produce. Graph the demand and supply schedules on the graph below.
Demand Supply Price per Quantity of Cookies Price per Quantity of Cookies Cookie Consumers Would Buy Cookie Class Would Sell .50 50 .50 1000 .40 200 .40 700 .30 400 .30 400 .20 700 .20 250 .10 900 .10 100
Supply and Demand for Cookies Price
Quantity of Cookies Supplied
- At what price is the quantity consumers would buy and the quantity the class would sell the same? ______________
- The answer in question 1 is called the market price. At prices above the market price, why would there be a surplus of cookies? (Use the graph to help you.) ______________________ ____________________________________________________________________________ ____________________________________________________________________________
- At prices below the market price, why would there be a shortage of cookies? ______________
- What price would you charge? ___________ Why? __________________________________
Answers for Appendix B Worksheets
The answers for most of the questions on the worksheets in Appendix B are given below. Questions that have very easy or obvious answers are omitted.
Goods or Services
2. A good is something tangible; a service is when someone does something for you. 3. Goods and services must be produced.
Natural, Human, and Capital Resources
1. Natural — gold, oil, water, fish, tree, soil; Human — teacher, doctor, mechanic; Capital — chalkboard, factory building, truck, telephone, pencil, hammer 2. Natural — land, water; Human — carpenters, bricklayers, plumbers, etc.; Capital — hammers, saws, generators, trucks, etc. 3. Natural — water, land, energy source for electricity, etc. Human — dentist, hygienist, receptionist; Capital — building, dentist chair, tools, etc.
Which Things Are Scarce?
1. The things that are not scarce are sunshine, air you are breathing, (However, since the air is relatively clean and may be cooled or warmed , you could consider it scarce.), saltwater at the beach, sand in the desert. 2. The answer is probably gold. Notice that the most valuable thing (water) is not necessarily the most scarce in an economic sense. This is because in normal situations water is relatively abundant, and its price is, therefore, relatively low in comparison to gold. However, someone stranded in the desert would pay more for water than gold! In this unusual situation, water would be more scarce. 3. Yes! Sunshine, saltwater in the ocean, air.
Choices Have Costs
2. The second choice! 3. No, his or her second choice (i.e. their opportunity cost) may be different. 4. Read a book; No. Only her second choice is her opportunity cost. Her final choice boils down to a choice between her top two choices.
Producers Have Opportunity Costs, Too
1. Producers make goods and services; consumers purchase goods and services. 2. The value of your next best alternative when you make a choice 3. How big a restaurant to rent or buy, how many workers to hire, what kind of menu to have, etc. 4. a. 20 acres of carrots b. what she would have made as a baby sitter c. the opportunity to be a mechanic d. the insurance agency
Who Provides the Service?
1. Government — police protection, street lights, library, water service (sometimes!), army and navy, garbage collection (sometimes!), court system, firefighter. Private Business — TV repair, taxi service, water service (sometimes!), carwash, garbage collection (some- times!), 2. Water service, garbage collection 3. Taxes! 4. Income, sales, property, excise (gasoline, hotel rooms, alcohol, etc.)
Services — Public or Private?
1. Government - fire protection, 1st class mail, national defense, police protection, street cleaning; Private Business —TV repair, haircuts, lawn mowing; Both - snow removal, education, mailing packages, garbage collection 2. Private armies wouldn’t work very well. Those who choose not to pay for national defense would still benefit from those who choose to pay for it. It is, therefore, much more effi- cient for government to provide for national defense through taxation.
Who Benefits from Trade
1. a. F b. T c. T d. T 2. a. Both b. Both c. Both 4. When someone buys an article of clothing, both the buyer and the seller benefit. It does not matter where the clothing was made. The buyer is happy to get the clothing; the seller is happy to get the money.
Money
2. Gold, silver, paper. They all fit the characteristics of money very well. Paper is best if governments do not print too much of it, causing inflation. Unfortunately this has often been the case. 3. Pebbles — not very scarce. 4. Gold and silver. They are scarce and people value them.
Working More Efficiently
1. Students will identify a variety of ways to improve productivity in each of these situations. 2. Answers will vary.
Caught in the Spider’s Web
1. The spider’s web lines can be drawn between any of the workers since all must depend on each other in some way. 2. Good Points — increases efficiency, more production, higher wages, standardized product. Bad Points — often boring, one missing worker stops the whole line, one worker making a mistake affects all the products.
