Economics Basics — Answer Key
Part A: Fix the Sentence
Each sentence has an error. Rewrite it correctly on the line.
1. Fix the sentence:
A haircut is a good because you can hold it in your hands.
Corrected: A haircut is a service because someone does work for you.
A haircut cannot be held or carried home, so it is not a good. It is a service because a barber does the work of cutting hair for you.
2. Fix the sentence:
A consumer is someone who makes products to sell at a store.
Corrected: A producer is someone who makes products to sell at a store.
Someone who makes products to sell is doing the work of a producer, not a consumer. A consumer is the person who buys and uses what producers make.
3. Fix the sentence:
A toy is a service because it is something you can buy and keep.
Corrected: A toy is a good because it is something you can buy and keep.
A toy is an object you can pick up, take home, and keep, which makes it a good. Services are work people do for others, like fixing or teaching, not items you can hold.
Part B: Fill in the Blank
Write the missing word or number on each line.
1. Something you can touch and buy at a store is called a good.
Anything you can touch and carry away from a store, like a book or a backpack, is called a good. Goods are physical items people buy.
2. A person who buys goods or services is called a consumer.
When a person pays money to receive goods or services, that person is acting as a consumer. Consumers use what producers make and sell.
3. Food, clothing, and water are examples of needs we all need.
Food, clothing, and water keep people alive and healthy, so they are needs. Needs are the things every person must have to survive.
4. A person who grows vegetables to sell at the market is a producer.
Growing vegetables and selling them means creating something for others to buy, which is the job of a producer. Producers make or grow the goods that consumers purchase.
Part C: True or False?
Read each statement. Circle True or False.
1. A bicycle is an example of a good.
True False
True. A bicycle is something you can touch, ride, and take home, which fits the meaning of a good.
2. A want is something you must have to survive.
True False
False. A want is something you would like to have but can live without, while a need is something you must have to survive.
3. A doctor provides a service when helping a sick patient.
True False
True. The doctor is doing helpful work for the patient instead of giving them an object, and work done for others is a service.