Economics Basics — Answer Key
Part A: Fill in the Blank
Write the missing word or number on each line.
1. When a store runs out of an item, the supply is low.
Supply is the total amount of a product that producers can offer to consumers.
2. Putting coins into a piggy bank is an example of saving.
Saving means setting aside money for future use instead of spending it now.
3. A dentist who cleans your teeth provides a service.
A service is work performed for others, such as teaching, cleaning, or repairing.
4. If everyone wants the new toy, demand for it goes up.
Demand is the desire and willingness of consumers to buy a product.
5. A factory that makes pencils is a producer of goods.
A producer creates, makes, or grows products for consumers to buy.
6. The thing you give up when you choose something else is the opportunity cost.
Cost is the price you pay to purchase a good or service.
7. A family that buys groceries at the store acts as consumers.
Consumers are people who purchase and use goods and services.
8. Toys and candy are examples of wants because you can live without them.
Wants are things people would like to have but do not need to survive.
9. Using your allowance to buy a snack is called spending.
Spending is the act of using money to purchase goods or services.
Part B: Matching
Match each item on the left to the correct answer on the right.
1. Match each item to its correct answer.
A warm winter coat.
→ Need (clothing)
Want
A new video game.
→ Want
Need (clothing)
A haircut at a salon.
→ Service
Need (water)
A glass of clean water.
→ Need (water)
Service
A warm winter coat is a need (clothing). A new video game is a want. A haircut at a salon is a service. A glass of clean water is a need (water).