LESSON: EARNING MONEY (SERIES: HOW ECONOMICS WORKS)

Lesson Summary

This book teachers students the basics of earning money, focusing on how to start a real business. Students learn that entrepreneurs must produce a quality good or service that people really want. The book gives examples of real student business success stories as well as a list of principles for making sure one’s business is a success. The last section focuses on basic bookkeeping skills. This book is a good primer for getting young people interested in the world of business and entrepreneurship.

Concept: Entrepreneur

Definition: An Entrepreneur is someone who takes the risk to develop a new product or start a new business.

Comprehension Questions:

How do people get most of their money?
They earn it by working! People also receive money through gifts.

What is an entrepreneur?
Someone who takes a risk to develop a new product or start a new business. Entrepreneurs can produce either a good (product) or a service.

Entrepreneurs are very good at noticing opportunities to make money.  They notice needs consumers have or problems they face. Why is this important?
If entrepreneurs can produce a good or service that solves these problems or meets these needs, they can have a very successful business.

What are some questions to ask yourself if you want to be an entrepreneur?
What do you like to do? What are you really good at? What needs do your family, friends, or neighbors have? Do you have big ideas or do you like to invent things?

Why is it important for entrepreneurs to do what they really like to do?
It gives them a passion and motivation to see their idea through to completion.

The author claims that people interested in starting a business should “not bite off more than they can chew?” What does that mean?
To be successful, one should start slowly and gradually build the business. If you try to do too much at once, you probably will not be successful.

How do entrepreneurs reach their customers? That is, how do they market their products?
Various types of advertising – flyers, internet, signs, radio, TV, etc.

What is the basic formula for being a successful entrepreneur or business owner?
Produce a quality product that people really want.

Why is it important for entrepreneurs to learn from their mistakes?
Everyone, entrepreneur or not, makes mistakes. The key to success is to learn from those mistakes and try not to make them again! 

Successful entrepreneurs have failed many times, but they never give up. Why is that important?
There are always tough times and difficulties to overcome. Successful entrepreneurs have the capacity to keep on trying. They persevere and keep on going.

Why do many entrepreneurs give money back to their community?
They recognize that the community is greatly responsible for their success – customers, police and fire protection, stable legal system, roads, helpful friends, etc. They also often want to help those who have not been as fortunate as they.

How do entrepreneurs compute their profit?
Sales revenues (earnings) – costs (expenses) = profit  When making business decisions, it is very important for entrepreneurs to consider the opportunity cost of their own time and other possible business/work opportunities.

Other Concepts: Profit, Productive Resources, Opportunity Cost, Supply and Demand

  Entrepreneur 

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