Earning, Saving, & Spending

Why is it important to save money?

• So you can sell more lemonade than your friends.

• So you can see the new movie before anyone else.

• So you will have it in case you need it in the future.

• So you can buy everything you want right now.

Why are households an important part of Louisiana's economy?

• Households lend money to people who want to start a business.

• Households provide services to tourists who visit our state.

• Households buy many goods and services.

• Households make and sell many kinds of goods and services.

Which of the following is the definition of profit?

• the decision to trade goods with other countries

• the money a business has left over after all its cost are paid

• the amount of good or service that people want and can pay for

• the decision to spend money instead of saving it

What is opportunity cost?

• the use of tools and ideas to solve problems

• What you give up when you choose one thing instead another.

• the amount of product that producers want to sell

• a decision to buy one thing instead another

How does competition between stores affect the price of goods?

• It usually causes prices to be lower

• It usually causes prices to be higher.

• It really has no effect at all on the economy.

_________ often lend people money to buy homes or start businesses.

• Consumers

• Producers

• Households

• Banks

What is it called when you get something, such as money, from working?

• save

• budget

• earn

purchases goods and services for personal use

• donating

• producer

• consumer

The amount of a product that producers want to sell to consumers

• Supply

• Demand

• Saver

• Spender

If there is a huge demand for an item and the supply is very low, what will happen to the price?

• The price will decrease
• The price will increase
• The price will stay the same.
• They will be free.