Who's Buying? Who's Selling?: Understanding Consumers and Producers (Lightning Bolt Books: Exploring Economics)

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Jennifer S. Larson

s

Lerner Publications Company Minneapolis

e c a r G For

Copyright

© 2010 by Lerner Publishing Group, Inc.

All rights reserved. International copyright secured. No part of this book may be reproduced, stored in a retrieval system, or transmitted in any form or by any means—electronic, mechanical, photocopying, recording, or otherwise—without the prior written permission of Lerner Publishing Group, Inc., except for the inclusion of brief quotations in an acknowledged review. Lerner Publications Company A division of Lerner Publishing Group, Inc. 241 First Avenue North Minneapolis, MN 55401 U.S.A. Website address: www.lernerbooks.com

Library of Congress Cataloging-in-Publication Data Larson, Jennifer S., 1967– Who’s buying? who’s selling? : understanding consumers and producers / by Jennifer S. Larson. p. cm. — (Lightning bolt booksTM—Exploring economics) Includes index. ISBN 978-0-7613-3912-0 (lib. bdg. : alk. paper)  1. Commerce—Juvenile TO COME literature. 2. Consumption (Economics)—Juvenile literature. 3. Supply and demand—Juvenile literature. I. Title. HF353.L37 2010 381—dc22 2009027460 Manufactured in the United States of America 1 — BP — 12/15/09 eISBN 978-0-7613-5957-9

Contents Consumers

page

Producers

page

4

8

Buyers and Sellers Cost and Benefit

page

14

page

22

Supply and Demand

page

26

Activity page

28

Glossary Further Reading Index page

30

page

31

page

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Consumers Mmm. The treats at this

bakery smell good. This boy buys a cookie.

4

He buys one for his sister too.

5

When you buy something, you are a consumer. A

consumer buys goods and uses services.

These consumers are enjoying the cookies they bought.

6

A good is something we can touch, such as a bike. A service is something someone does for another person. A person who fixes bikes provides a service. 7

Producers Where do goods and services come from? People have jobs making goods and providing services.

8

Dairy farmers provide a good. They raise dairy cows. The cows’ milk is a good.

Someone who makes a good or provides a service is called a producer. This man is making a good. He is making cheese.

9

Producers need resources to make goods and provide services.

Resources are the things producers use to create goods and services .

10

Wood is one example of a resource.

Wood and nails are resources a builder uses to make a house. A screwdriver and a wrench are resources used to fix a bike. 11

These blueberries are a resource for a baker.

Producers decide what to make with the resources they€have. 12

h

m o a ke t s e blu d i c eb de e e

rry

S

A baker has lots of blueberries.

€pi es . 13

Buyers and Sellers Buyers and sellers depend on each other. People need food and clothes. They need a place to buy them.

14

Sellers provide many things we need and want.

This house painter is selling a service people want.

15

Se

l

le

16

n b o u d y n e e r s to p e d o. s r When you buy a good or a service, the seller earns€money.

Sellers use the money they earn to buy the things they need and want.

This woman earned money by selling new homes to families. She can use that money to buy items such as clothing.

17

The price is the amount of money people pay for a good or service. The seller decides the price.

A grocery store worker makes sure the prices on the food are correct.

18

If the price is too high, no one will buy it. If the price is too low, the seller might not earn enough money.

This clothing is priced at $10. Will it sell?

19

Anywhere people buy and sell goods and services is called a market. Consumers make choices about what to buy in a market.

20

People are selling goods in this outdoor market.

Different farmers are all selling apples. How will you decide which ones to buy? You might decide based on the price. Or you might buy the apples that taste best to you.

21

Cost and Benefit Consumers think about the cost when they buy something. The cost is what we give up. We give up money and the chance to buy something else. This girl is thinking about the costs of buying a bike.

22

Consumers also think about the benefits of spending their money. A benefit is what we gain when we buy something. We get what we want or need. She decided that the benefits of the bike were greater than the cost.

23

W 24

b o u a t s e c i o h c e k . y u a b o t m t l l a wh a e You might need new pencils for art class. But maybe you also want to buy a€toy.

What are the costs of buying pencils? What are the benefits?

fi t

e c os ts a n h t e r db a g n t i t h y e€to en u a b h of e y ? W

s

If you buy the toy, you won’t have pencils for art class.

25

Supply and Demand It is a hot day, and you are thirsty. You see just one lemonade stand. The demand for lemonade is high. Lots of people want it. They have only one place to get it. The seller can set a high price for the lemonade.

26

On another hot day, you see a lot of lemonade stands. The supply is high. That means there is a lot of lemonade. Sellers can’t set their prices too high. You can find a good deal on lemonade!

27

Activity

Costs and Benefits Help Max decide what to do with his $10. He wants to buy a kite. The kite costs $10. But he also wants to get his brother a birthday present. That would cost $7.

28

What are the benefits of each choice? What are the costs? Max has already started a list of costs and benefits. Can you think of other costs and benefits for Max to add to the list?

enefits B d n a s t s o C Kite: $10 . 0 0 Cost:

one thing. n o y e n o m y m ll I would spend a y brother. m r o f t n se e r p ea I would not hav

Benefit:

I really want. e it k e h t e v a h I would

.0 0 7 $ : t n e s e r p y a Birthd Cost:

kite I want. e h t e v a h t o n I would

Benefit:

be happy. ld u o w r e h t o r thing else. b e m My so y u b o t r e ney left ov I would have mo

29

Glossary benefit: what a person gains from buying something

consumer: someone who buys goods and uses services

cost: what a person gives up to buy something demand: the need or desire for a good or service. If there is a demand for something, many people need or want it.

earn: to get money for work done good: a thing you can touch that can be bought and sold

market: anywhere goods and services are bought and sold

price: the amount of money people pay for a good or service

producer: someone who makes a good or provides a service

resources: things used to create goods and services

service: work done by someone for others supply: the amount of a good or service available

30

Further Reading Dalton, Julie. Counting Money. New York: Children’s Press, 2005. Hill, Mary. Spending and Saving. New York: Children’s Press, 2005. It’s My Life: Money http://pbskids.org/itsmylife/money/index.html Larson, Jennifer S. What Can You Do with Money?: Earning, Spending, and Saving. Minneapolis: Lerner Publications, 2010. Nelson, Robin. What Do We Buy?: A Look at Goods and Services. Minneapolis: Lerner Publications Company, 2010.

31 31

Index benefit, 23, 25, 29 buyer, 14, 16 consumer, 6, 20, 23 cost, 22, 25, 29

market, 20 price, 18–19, 21, 26–27 producer, 9–10, 12 resource, 10–13

demand, 26 good, 6–10, 16, 18, 20

seller, 14–19, 26–27 service, 6–10, 16, 18, 20 supply, 27

Photo Acknowledgments The images in this book are used with the permission of: © Julie Caruso/Independent Picture Service, pp. 2, 22, 23; © Todd Strand/Independent Picture Service, pp. 4, 5, 6, 26, 27; Thomas Northcut/Digital Vision/Getty Images, 7; © Owen Franken/CORBIS, p. 8; © Ludovic Maisant/CORBIS, p. 9; © iStockphoto.com/Ann Marie Kurtz, p. 10; © iStockphoto.com/robert cocquyt, p. 11; © DesignPics Inc./Photolibrary, p. 12; © Burke/Triolo Productions/Brand X/CORBIS, p. 13; © Blend Images/StockphotoPro.com, p. 14; © iStockphoto.com/Mark Tenniswood, p. 15; © White Packert/Iconica/Getty Images, p. 16; © Juliet White/Photolibrary, p. 17; © CORBIS, p. 18; © iStockphoto.com/ Miroslav Simanek, p. 19; © Richard Levine/Alamy, p. 20; © Julie Caruso, p. 21; © iStockphoto.com/fanelliphotography, p. 24; © iStockphoto.com/Sarah Holstrom, p. 25; © iStockphoto.com/Viorika Prikhodko, p. 28; © iStockphoto.com/David Partington, p. 29; © Thomas Northcut/Digital Vision/Getty Images, p. 31. Front cover: © Todd Strand/Independent Picture Service.

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Have you ever bought a cold drink at a lemonade stand? Or have you baked cookies for a school bake sale? If so, you’re a consumer and a producer! Consumers, producers, buyers, and sellers all provide things other people want and need. How do they work together in the marketplace? Read this book to find out.

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Learn all about how we earn, spend, and save in the Explorin g Economics series—part of the Lightning Bolt BooksTM collection. With high-energy designs, exciting photos, and fun text, Lightning Bolt BooksTM bring nonfiction topics to life!

Exploring Economics Do I Need It? Or Do I Want It?: Making Budget Choices What Can You Do with Money?: Earning, Spending, and Saving What Do We Buy?: A Look at Goods and Services What Is Money, Anyway?: Why Dollars and Coins Have Value Where Do We Keep Money?: How Banks Work Who’s Buying? Who’s Selling?: Understanding Consumers and Producers