iPad 72% 1:53 Thursday, February 28 click arrow to begin ALL ABOUT MONEY

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Money WHAT IS MONEY? Money is something of value Money Each country uses its own form of money called “currency” The currency used by the United States, Canada and Australia is called the dollar The euro is the currency used by countries in Europe The peso is used in Mexico Each country makes their own currency WHAT DOES AMERICAN CURRENCY LOOK LIKE? Today, money is the U.S. is made from paper and metal into the form of bills and coins with designs 2

Money MONEY FROM OTHER COUNTRIES 3

Money HISTORY OF MONEY Before the invention of money, people used the barter system in exchange for other thingsbarter system The oldest form of money used for barter was cattle (cows, sheep, camels and other livestock) China was the first to make metal money and coins using bronze and copper metals, as well as paper currency 4 WHY IS USING MONEY BETTER THAN BARTERING? The person you are bartering with may not have anything you want, when you want it, and they also may not want or need what you are offering Each person may have a different opinion of what something is worth Using money is easier because every good or service has a set price, and since money has set values, equal exchanges can be made. For example, a storeowner has a piece of gum on sale for $0.25. In order for you to buy that piece of gum, you must give the storeowner a quarter (or 2 dimes and 1 nickel…or 5 nickels...Right? )

Needs & Wants WHAT ARE NEEDS? Needs are things that people must have in order to live such as air, water, food, clothing and shelter WHAT ARE WANTS? Wants are things that people do not have but would like to get them. Wants are not necessary to have in order to survive. Can you think of something that you feel is a need, but may actually be a want? 5 TELLING NEEDS AND WANTS APART Candy is something Noah WANTS. Vegetables are something Noah NEEDS. MAKING CHOICES WITH MONEY You should satisfy all of your needs (food and shelter) before spending money on the things you want (video games, dolls)

Goods & Services GOODS Goods are things that we buy with money. Almost all of our needs and wants are either goods or services. Goods Most goods come from natural resources What are some of your favorite goods that you like from the grocery store? That you play with at home? That you use every day to get ready? SERVICES A service is work done for other people. In most cases, services require money from the person receiving the service.service Can you think of some services that you or your parents have received from someone in the past? Can you think of any FREE services? 6

Goods & Services NATURAL RESOURCES Natural resources are things surrounding us in our environment that can be used to make something else. Examples: fruits, vegetables, grains, oil, wood, metal, fish, minerals Natural resources Can either be classified as either renewable or non-renewablerenewable or non-renewable Can become scarce if we use too much of it before it has time to renew itself. This leads to scarcity of a resource.scarcity SCARCITY This happens when the demand (or want) for something is greater than the supply When resources are scarce, people have to make choices: »Pay higher prices »Shop for better prices at other stores »Buy an different item that is like the scarce item »Buy nothing at all 7

Goods & Services OPPORTUNITY COSTS The choices people make leads to opportunity costs. Opportunity costs, simply defined, is the cost of making a choice. It helps us decide if the choice we made was a good choice.opportunity costs 8 For example, you have some allowance money that you have been saving for a while so that you can buy a new video game which costs between $20-$30. As you are leaving for the store to go buy the video game, your best friend calls and invites you to go to Sky Zone and then to the movies, which will cost about $20-$30 too. What do you do? If you choose to buy the video game, then the opportunity cost is not going to Sky Zone and the movies with your best friend. If you choose to go with your best friend, then the opportunity cost is not being able to buy the new video game. Make sense?

Producers & Consumers PRODUCERS Those that provide or make the goods are called producers. Farmers are producers because they grow the food that we eat. Dentists are producers because they provide the service of cleaning our teeth.producers A producer can be something else besides a person! CONSUMERS Those that use the goods and services provided by the producers are called consumers. consumers A consumer can be something else besides a person! Can you be both a producer and consumer? YES! 9

Earning & Saving 10 EARNING People go to work so that they can earn money for the jobs that they perform. Other people make things that they can sell to others for money. Kids can earn an allowance for helping do chores around the house. BUDGET We already know that we have to spend money on our basic needs in order to survive. But what if there is money left over? Before we do anything with it, we should create a budget.budget A budget is a plan of how to spend and save your money. It can show how much money has been earned, used for basic needs, and how much is left.

SPENDING Make sure to spend your money first on the things you need BEFORE you spend money on the things you want. Before buying something, make sure you’ve found the best price for the item. Sometimes if you wait just a few days, the item will go on sale and save you money. Spend your money WISELY! SAVINGS You can choose not to spend all of your money and save it instead. Some people have a savings account at a bank. The bank will hold the money in a safe place until it is ready to be used. The bank will pay you a small amount of money, called interest.interest Earning & Saving 11

Earning & Saving 12 A good rule to follow for saving and spending is this: 80% for spending (needs/wants) / 10% for savings / 10% for sharing (charities, etc.) = 100% of money earned For example, if you received $10 for your monthly allowance: $8 would be available for spending $1 would go to savings $1 would go towards sharing

What is Credit? 13 CREDIT Credit lets people buy goods or services now, but pay for them in future. Credit A bank will lend you money to buy something, and then allow you to pay back the loan in small amounts over a period of time. A fee, called interest, will be added to the amount of money you borrowed until you have paid back the entire amount.interest A common form of credit is the credit card, car loan or home loan. It is wise to not overuse a credit card and to try and pay off the entire balance each month.

REVIEW 14 Money is something of value Needs are things that people must have in order to live such as air, water, food, clothing and shelter Wants are things that people do not have but would like to get them. Wants are not necessary to have in order to survive. Most goods come from natural resources A service is work done for other people. Scarcity happens when the demand ( or want) for something is greater than the supply Opportunity costs, simply defined, is the cost of making a choice. It helps us decide if the choice we made was a good choice. You should satisfy all of your needs (food and shelter) before spending money on the things you want(video games, dolls) Producers provide or make goods or services. Consumers use the goods and services provided by the producers. A budget is a plan of how to spend and save your money. Not spending all of the money you earn is called saving. A good rule to follow when planning your budget is the 80/10/10 rule. Credit lets people buy goods or services now, but pay for them in future. A fee, called interest, will be added to the amount of money you borrowed until you have paid back the entire amount.

VOCABULARY Barter SystemTo exchange goods or services with someone else, without the exchange of money. BudgetA plan for how to spend and/or save money. ConsumersThose that use goods and services. CreditMoney loaned to you so that you can buy something now, and pay for it later. GoodsThings that are grown, like fruits and vegetables, or produced, like clothes and toys. InterestSavings – An amount of money that the bank will add to the money in your savings account. Credit – A fee the bank adds to the amount of money you borrowed. Money Something used by people to buy a good or service. Natural ResourcesNatural resources are things surrounding us in our environment that can be used to make something else. Renewable resources – Can be refilled naturally (such as air, sunlight and water) and are plentiful. Non-renewable resources– Takes a great amount of time to be made again (such as a tree). Opportunity CostsThe cost of making a choice. ProducersThose that produce goods and services. ScarcityA shortage of something. ServicesWork that is performed by someone for someone else, usually in exchange for money. 15