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Economics:
The Production, Distribution and
Consumption of Goods and Services
Lesson 3:
Needs and Wants
catalog #2223
Teacher’s Guide
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Teacher’s Guide
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Ron Meyer
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ECONOMICS:
The Production, Distribution and
Consumption of Goods and Services
A Unit of Study
Grades 4-6
GENERAL DESCRIPTION OF THE SERIES
ECONOMICS: The Production, Distribution and Consumption of Goods
and Services is a live-action, five-part series which presents the basic
concepts and principles of economics, which include: resources, producing, needs and wants, consumption, and money. The series simplifies these often complex concepts through the use of historical tracing, graphics, and humorous skits. Throughout the programs the students are exposed to the element of choice, a basic responsibility that is
involved in all economic decisions.
UNIT GOALS
The materials in this Unit of Study are designed to assist students in
developing a working knowledge of…
• How people organize for the production, distribution, and consumption of goods and services.
• How economics plays a role in each person’s life, and how each person plays a role in economics.
• The role of “opportunity costs” in each person’s life.
• How today’s economic decisions affect present and future economic
factors.
Specific student objectives are contained in the teacher’s guide supplied for each video lesson. These objectives will assist students in
grasping the fundamentals of each topic. By achieving these objectives for each video lesson, the students should be able to accomplish
the unit goals.
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MATERIALS IN THE UNIT
Videocassettes
This unit contains five individual videocassettes – one for each video
lesson. The titles and a brief description of the contents of each video
are provided below. The programs may be viewed independently or
as a unit of study and do not need to be in any particular sequence.
The description of the program contained in this guide, Lesson 3, is
printed in bold type.
Lesson 1: RESOURCES
Use of resources is fundamental in all economic activities. This program defines and illustrates the three basic kinds of resources: 1) natural resources, 2) labor, 3) capital. The student learns that resources are
not distributed evenly across the planet. The program emphasizes the
principle of “opportunity costs” in all phases of resource utilization;
i.e., the use of a resource for one thing means it cannot be used for
something else. Finally, the program presents some of the forces that
determine how we choose to use resources in economic activities.
Viewing Time: 16:30 minutes
Lesson 2: PRODUCING
Producing is the process whereby resources are turned into goods and
services. In this program the student learns the differences between
goods and services and that each is divided into consumer and industrial goods and services.
The “factors of production” are clearly defined and illustrated by real
businesses and companies. Finally, through skits, we see how the factors of production can be combined in various ways in the market
economy to result in profit and losses.
Viewing Time: 17:50 minutes
Lesson 3: NEEDS AND WANTS
The satisfaction of needs and wants drives economics. This program defines the three basic needs: 1) food and water, 2) shelter, 3)
clothing. The student learns that satisfying basic needs is a difficult
problem and not the same for all people today or throughout time.
Wants are potentially endless and this program shows how the market economy works to satisfy wants. At the same time, the student
learns that the principle of “opportunity cost” governs the use of
resources to satisfy needs and wants.
Viewing Time: 14:40 minutes
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Lesson 4: CONSUMING
Consuming is the way we go about satisfying our needs and wants by
choosing goods and services. The student learns that the principle of
“opportunity cost” plays a major role in consuming, since we cannot
have everything we want. The three fundamental categories of consuming are defined as: 1) durable goods, 2) non-durable goods, and 3)
services. This program, through skits, shows the major pressures at
work which influence our choices as consumers. Lastly, the program
traces the growth of consumerism throughout the U. S. in the last part
of this century.
Viewing Time:: 14:50 minutes
Lesson 5: MONEY
Money is the cornerstone of modern economic activity. This program
traces the evolution of money through history, starting with bartering
and ending with today’s new electronic forms of monetary exchange.
Illustrated by humorous skits, the five defining properties of money
are: 1) accepted as medium of exchange, 2) store of value, 3) easily
divisible, 4) high value for weight, and 5) hard to counterfeit. Finally,
the program presents the concepts of savings, checking accounts and
credit cards.
Viewing Time: 14:20 minutes
Teacher’s Guides
A guide has been provided with each program in this series to aid
the teacher in utilizing the materials contained within this Unit of
Study. They contain the following:
• Suggested instructional procedures for each lesson.
• Discussion questions, follow-up activities, and extended learning
activities for each lesson.
• Answer keys for blackline master activities.
• The script of each video narration.
Blackline Masters
Blackline master activities for each video lesson are included in this
Unit of Study. These activities are designed to reinforce the information in the videos and to provide extended learning activities for the
students.
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INSTRUCTIONAL NOTES
It is suggested that you review each video lesson and read the Suggested Instructional Procedures of the teacher’s guide before involving your students in the lesson activities. In this way you will become
familiar with the materials and be better prepared to adapt them to the
needs of your student. You may find it necessary to make some changes,
deletions or additions to fit the specific needs of your class. We encourage you to do so, for only by tailoring this program to your students will they obtain the maximum instructional benefits afforded by
the materials.
It is also suggested that the video presentation take place before the
entire group under your supervision. The lesson activities grow out of
the content of the video; therefore, the presentation should be a common experience for all students.
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Lesson 3
NEEDS AND WANTS
Time: 14:40 minutes
SUGGESTED INSTRUCTIONAL PROCEDURES
TEACHER PREPARATION
• Preview Lesson 3, “NEEDS AND WANTS”
• Duplicate blackline masters 1-4
It is suggested that you relate the learning of basic economics concepts
to a couple of the big economic issues of the day, both nationally and
locally. To do this, we suggest watching the news and reading the
newspaper for a few days in advance of showing the video and raising
the issues of the day in order to peak interest and relevancy.
STUDENT MATERIALS REQUIRED
Each student should have a pencil for completing the blackline master
activities.
STUDENT OBJECTIVES
Keep the following student objectives in mind throughout the lesson.
After viewing the program and participating in the attendant activities, students should be able to do the following:
• Name and describe the three basic kinds of economic needs.
• Explain that basic needs are universal, the same for all people on
Earth and that wants vary from individual to individual.
• Explain how the food we eat at the dinner table is the result of a
process that uses many resources.
• Describe how people in other parts of the world satisfy basic economic needs.
• Explain that people live in a wide variety of shelters and give examples of those shelters.
• Describe some basic needs that are not economic.
• Define “opportunity cost.”
• Discuss and explain that human wants are endless and changing.
• Describe the free market economy.
• Tell how wants put pressure on the use of limited resources.
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INTRODUCING THE VIDEO
Ask the students what “things” they think are essential to their survival. Accept all answers. Tell the students that they are going to see a
video about how economics plays a role in providing some of the things
that keep them alive.
All their lives they have been saying, “I want...” Ask them why they
do this so much. Accept all answers. Tell them that this video is going
to show how all of their “wants” have consequences and involve choices
that they may not have thought about.
Tell them that they are going to learn about what many Americans
consider to be the most important characteristic of the country, the free
market economy.
Finally, tell them the video will show them that basic economic needs
are not being met in many countries.
View the video. The viewing time is 14:40 minutes.
FOLLOW-UP DISCUSSION
You may choose from the following questions to conduct a class discussion. Feel free to add or delete questions to suit the needs of your
audience.
1. What are the three basic economic needs?
Answer:
1) Food and water, 2) shelter, and 3) clothing.
2. Are there people who can live without having their basic economic
needs met? Explain your answer.
Answer: No. Answers will vary.
3. What are some resources used in producing food that we eat?
Answer: The grocery store and the people who work there, food processing
plants, the farmer, domesticated plants and animals, land for growing, fresh
water, sunshine, air, topsoil, and farm equipment. Energy: hydro-electric,
geo-thermal, nuclear, coal, gasoline (oil), and natural gas.
4. What are some resources used in building a house?
Answer: Lumber (trees, forests), construction workers, architect, machinery, tools, nails and other hardware (steel, metals), plastics (oil). Also land on
which the house sits. Energy: hydro-electric, geo-thermal, nuclear, coal, gasoline (oil), and natural gas.
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5. What are some resources used in making clothing?
Answer: Many of the same resources for growing food: farmer, sheep shearer,
domesticated plants (cotton, flax) and animals (wool, leather), land, fresh water,
sunshine, air, and topsoil. Also oil for some synthetics. People who design
fabrics and clothing, machinery and factories. Energy: hydro-electric, geothermal, nuclear, coal, gasoline (oil) and natural gas.
6. Describe how some people in other parts of the world and in past
societies satisfy their basic needs.
Answer: Hunting, gathering fruits and nuts, grow their own gardens,
and make all their own clothes from animal skins, use available materials to
build shelters (homes).
7. Make up your own description of “opportunity cost.”
Answer: If I spend my money on candy, then I cannot go to the movies.
If oil is used to make plastic, then it cannot be used to make gasoline.
8. How does the free market economy create the satisfaction of needs
and wants?
Answer: A large demand requires that resources be used to satisfy that
demand rather than a lesser demand.
9. Give an example of wants impacting our basic economic needs.
Answer: While everyone needs food, shelter, and clothing, we have choices
in what we eat, where and how we live, and what we wear.
FOLLOW-UP ACTIVITIES
1. Distribute Blackline Master 1, What’s Important. Explain to the
students that many items of high rank are considered wants, and that
the only items that are basic needs are food/drink, clothing, and shelter.
2. Distribute Blackline Master 2, Math Problems. Explain that many
economic decisions involving needs and wants can be illustrated using mathematics; needs must be satisfied before wants, and opportunity cost usually dictates that choosing to satisfy certain needs and
wants means leaving others unfulfilled.
3. Distribute Blackline Masters 3, Vocabulary. Note that examples of
needs, wants, and opportunity costs will vary among students.
4. Distribute Blackline Master 4, How Wants Change Over Time. Have
students track their wants on timelines of their lives to illustrate how
wants change constantly. Start with infancy and end with old age.
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Emphasize the change in influences throughout life--as babies, we have
very basic needs; as children, we are surrounded by peer pressure; as
adults, we must think of our families and other responsibilities.
5. Have students create an imaginary market. Identify and price ten
items available in the market. Give the class an “allowance” that will
allow it to purchase some goods, but not all of them. Have the class
develop a “purchase,” encouraging students to debate the various opportunity costs involved in their decisions.
ANSWER KEY
Blackline Master 1, What’s Important
Answers will vary.
Blackline Master 2, Math Problems
1. $5.11
2. $11.70
3. $52.02
4. $999.99 (The house payment must be less than $1,000.)
5. $145.00
Blackline Master 3, Vocabulary
1. Needs: Something required for health or living. Examples may include housing, clothing, food, water, medical care.
2. Wants: Those things which are desired but not necessary. Examples
may include entertainment, make-up, vacations, sporting goods.
3. Opportunity Cost: Choice between satisfying certain wants and
needs and not others.
Blackline Master 4, How Wants Change Over Time
Answers will vary.
EXTENDED LEARNING ACTIVITIES
These activities go beyond the information presented in the video and
accompanying follow-up activities. They are intended to require the
students to apply information learned from this video lesson. Choose
those activities which are appropriate for your group.
1. Have students organize a food and/or clothing drive to benefit a
local shelter. Discuss the implications of not satisying basic needs and
why there is uneven fulfillment of basic needs. Iterate that by helping
others satisfy their basic needs, we serve the greater good of humanity.
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2. Have each student select a country and research its methods of fulfilling basic needs and the factors influencing wants. Have students
present their findings to the class.
SCRIPT OF VIDEO NARRATION
Economics is about almost everything we do. It’s about money. It’s
about who is rich and who is poor; and it’s about jobs--what people do
for a living. Economics is also about the products we buy, the food we
grow and eat, and the things we make. Economics is the science of
how people use resources to satisfy their needs and wants.
In this program, we will look at how the study of economics defines
these needs and wants
NEEDS AND WANTS
We all have certain needs that are essential to stay alive. These needs
are shared by people all over the world. Whether you live in South
America, Africa, Asia, or North America, satisfying these needs is essential.
First, we all need food. Most of us need to eat every day; if we don’t,
we will become weak and unhealthy.
Just think of all the efforts and resources we put into food. Restaurants
are everywhere and stores stocked with food.
We also need good, clean drinking water every day. If the water becomes polluted or contaminated, it can cause illness and disease.
In fact, every city in the United States has a water treatment plant to
make the water we drink safe. This is a big commitment of resources.
Another need is shelter. For most of us, this means a home to live in.
Our final major need is clothing. Without clothing, it would be very
difficult to live in areas of the world where the weather gets cold.
So, the three major needs are food and water, shelter, and clothing.
Let’s look more closely at how resources are used to satisfy these major needs. First, food.
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Food, for most people in the United States, starts with someone growing crops or livestock on a farm. This is wheat. The land on which the
growing takes place is a resource and so is the work of the farmer. It’s
called labor.
In most of North America, after the crop is harvested, it’s taken to a
grain elevator. It is then sold to a business that processes the grain into
products, such as flour. Flour is then used to create a variety of food
products. Here we see the capital resources used in food processing:
buildings, machines, and more labor. Eventually the food shows up in
stores where shoppers can buy a product made from wheat, like bread,
crackers, cereal, and pasta. So, you can see that the whole process from
land to the kitchen table is complex and involves using many resources.
However, for many people in the world, obtaining food is far simpler.
The Native Americans who live in South America simply go into the
rain forest and collect nuts and fruits to eat.
Let’s look at shelter. There are many ways to satisfy the need for shelter. In North America, some people live in small houses, some live in
large houses, while others live in apartments. However, our South
American family lives in a hut made from materials again gathered
from the rain forest.
One of the resources used in building a typical home in North America
is lumber, which comes from trees, a natural resource.
Another resource used in building a home is concrete. Concrete is
made up of the natural resources gravel, cement, and water. Mixing
the items together requires complicated equipment, like the cement
trucks and the computer systems that control the filling of the trucks.
Building homes also uses labor and other forms of capital resources,
such as tools.
Clothing. At one time clothing was made from animal hides. For
American Indians, animals like deer and buffalo were major natural
resources.
These blankets are made from the wool of sheep, an animal resource.
The wool is sheared using machines and labor. Later the wool is spun
into yarn and woven, using tools and labor. The end result is sold in a
store, which uses the resources of land, buildings and again, labor.
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However, some clothing today is made from fibers that were derived
from oil, a non-renewable natural resource. So we can see that many
different resources are continually being used to satisfy our needs.
Humans also have other needs, like sleep and love, but they are not
considered to be part of economics. Why? Because there is no process
that uses resources to bring about the satisfaction of these needs.
Now let’s look at “wants.” Whereas needs are few, wants are limitless.
Here are some things we might want.
Telescopes, diamonds, cars, toys, an education, protection from crime,
football, baseball, TV.
So many things, so many wants. How do we decide? In economics,
one of the most important principles is that all of our own wants cannot be satisfied. We must make choices. This is called “opportunity
cost.”
For example, Joe gets a ten dollar allowance. Joe wants too many things.
He wants baseball cards, he wants candy, and he wants to play video
games. In fact, he wants lots of cards, lots of candy, and wants to play
lots of video games. But when Joe goes to the mall to satisfy his wants
by using his allowance, he finds that he needs to choose. In satisfying
some wants, others are not fulfilled. More of one thing means less of
another.
Baseball cards are one dollar a pack. Candy is two dollars a package.
Video games are one dollar per play.
Joe could buy ten packs of baseball cards and get no candy or video
game plays.
Or Joe could get a little of each: four packs of baseball cards, two packages of candy, and two video plays.
Finally, Joe could save his money, hold off his desire for something in
the future.
One of the most important guidelines or problems in economics is how
people decide--how they satisfy their needs and wants.
In many countries, like the United States, the economy is referred to as
a market economy, represented here by this rock and mineral market.
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A market is a place where people come with their needs and wants,
and other people come with goods and services they hope will satisfy
the needs and wants. At this rock and mineral market, there are people
who want to buy items and people who want to sell items.
The basic law of the free market system says that, over time, the market itself will guarantee that items will be brought to the marketplace
that people want to buy. As you can see, this is pretty much true at the
rock and mineral show.
Let’s look at Joe one more time and see how this concept works.
Suppose Joe wants not baseball cards, but cards with trees on them.
He goes to the mall and finds there are no tree cards.
If only Joe wants tree cards, the economic way of saying this is that the
market demand for tree cards is small. He will only find sports cards.
But if millions of kids wanted tree cards, the market economy would
say that when Joe goes to the mall he’ll find tree cards to buy, just as
now he finds baseball cards.
Or we can say that because there are so many baseball cards at the mall
marketplace, many kids must want baseball cards.
So the market system says that if needs and wants are great, they will
be turned into demands, and then resources will be used to satisfy
these demands by producing products, like these baseball cards, that
satisfy our wants and needs.
Now whether this really works depends on how people choose to use
their resources and if there are enough resources to satisfy needs and
wants.
In America, most of the people have their basic needs met. They eat,
drink clean water, have clothes on their backs, and live in homes. But
not everyone does. And in many other countries, this is not true at all.
This map of the world shows the countries where the majority of the
people are lacking food, shelter, and clothing.
Of the five and one-half billion people living today, approximately 15%,
800 million people, are not getting their basic economic needs met.
Because many resources are limited, we must all use our resources more
carefully so that we can satisfy the needs and wants of all the people
on the planet.
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1
Name ____________________________
ECONOMICS
The Production, Distribution and Consumption of Goods and Services
Lesson 3: Needs and Wants
What’s Important
Directions: Rank the following goods and services in order of importance to you. Number 1
would be the most important and number 20 would be the least important.
_____ candy
_____ television
_____ potato chips
_____ pizza
_____ haircut
_____ video games
_____ shoes
_____ bicycle
_____ vegetables
_____ hamburgers
_____ winter coat
_____ roast beef dinner
_____ road repair
_____ medical care
_____ a place to live
_____ drinking water
_____ friendship
_____ roller blades
_____ telephone
_____ CD player
©1996 Centre Communications
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2
Name______________________________
ECONOMICS
The Production, Distribution and Consumption of Goods and Services
Lesson 3: Needs and Wants
Math Problems
Directions: Write the correct answer in the space provided below each question. You may use the back
of this sheet if necessary.
1. If you have $10.00 and you spend $4.89 on art supplies, how much money can you spend to go to the
amusement park?
2. The following items cost:
video play = $1.00
entrance fee to museum = $.75
book = $6.95
double-dip ice cream cone = $1.80
movie = $4.25
chewing gum = $.45
You have $3.50 now. How much more money to you need to acquire all of the “wants” above?
3. You have earned $50.00 over the summer and decide to open a savings account at the bank. The
bank will pay you 2% interest per year. How much money will you have at the end of two years if you
leave your money in the savings account? Hint: During the first year, you will have $50.00 + interest
(.02 x $50.00).
4. When you become an adult, you may want to purchase a house. Suppose that your income is
$36,000 per year. Your bank will lend you money to buy your house as long as your payments are less
than 1/3 of your monthly income. What is the maximum house payment that you can make each
month?
5. Suppose that your salary is $1,200 a month. Your monthly expenses are as follows:
Rent
$400.00
Health Insurance
$110.00
Groceries
$325.00
Utilities
$ 90.00
Bus fare
$ 10.00
You need to put 10% of your salary into your savings account so that can save enough money to buy a
new car. How much money do you have left for “wants?” Show your work.
©1996 Centre Communications
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3
Name______________________________
ECONOMICS
The Production, Distribution and Consumption of Goods and Services
Lesson 3: Needs and Wants
Vocabulary
Directions: Define the following terms and give three examples of each.
1. needs:
1) _________________________________
2) _________________________________
3) _________________________________
2. wants:
1) ________________________________
2) ________________________________
3) ________________________________
3. opportunity cost:
1) ________________________________
2) ________________________________
3) ________________________________
©1996 Centre Communications
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www.agcunitedlearning.com e-mail: [email protected]
4
Name__________________________
ECONOMICS
The Production, Distribution and Consumption of Goods anbd Services
Lesson 3: Needs and Wants
How Wants Change Over Time
The timeline below represents your whole life from infancy to old age. Fill in the blanks with something you wanted or will
want at each age.
Distributed by AGC/United Learning
Birth 1 year 5 years 10 years 15 years 20 years 25 years 30 years 40 years 50 years 55 years 60 years 65 years 70 years 75 years 80 years
© 1996 Centre Communications
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