Social StudiesWe Trade Money for Goods and Services
Sage stands at a busy neighborhood market on a sunny morning, holding a small coin purse and pointing excitedly at a baker handing a loaf of bread to a smiling child, while nearby a woman pays a barber who is cutting a boy's hair.
- Identify money as something people use to get things they need or want.
- Distinguish between goods (things you can hold) and services (actions people do for you).
- Sort everyday examples into the groups goods and services.
- Explain why a person gives money to a store or a helper.
- Predict whether a named example is a good or a service.
Key terms
- money
- Coins and bills people use to get things they need or want.
- good
- A thing you can hold in your hands, like a book or banana.
- service
- A helpful action a person does for you, like cutting your hair.
- trade
- Giving one thing to get another thing in return.
Goods Are Things You Can Hold
A good is something real that you can pick up and carry home. When you buy a loaf of bread, a pair of shoes, or a stuffed bear, you are buying a good. You give money to the seller, and you walk away holding the item. A simple way to spot a good is to ask whether you can hold it in your hands. If the answer is yes, it is almost always a good.
Services Are Actions People Do
A service is different from a good because you cannot hold it. A service is a helpful action that another person does for you. When a dentist cleans your teeth, a barber cuts your hair, or someone washes your family's car, that person is giving you a service. You still pay money for it, but instead of carrying something home, you receive the helpful work the person did for you.
Why We Trade Money
People use money to trade for the things they need and want. Instead of swapping toys or chores, we hand over coins and bills, and in return we get a good we can keep or a service someone performs. This makes it easy for everyone to get what they need from many different sellers and helpers, whether that is food from a baker or a haircut from a barber.
Worked examples
Decide if a muffin from a baker is a good or a service.
- Ask: can you hold the muffin in your hands?
- Yes, you can pick it up and carry it home.
- Things you can hold are goods.
- So the muffin is a good.
Answer: The muffin is a good because you can hold it.
Decide if mowing a lawn is a good or a service.
- Ask: can you hold the lawn-mowing in your hands?
- No, mowing is an action, not an object.
- A helpful action done for you is a service.
- So mowing the lawn is a service.
Answer: Mowing the lawn is a service because it is an action done for you.
Activity
Drag each item into the correct basket — Goods or Services!
Practice
Name one good and one service that families pay money for.
Explain how you can tell a good apart from a service.
Common mistakes to avoid
- Making something turns it into a service.A made object you can hold, like a muffin, is still a good, not a service.
- Only goods cost money.Both goods and services cost money, because people pay for helpful actions too.
Check your understanding
Maya gives coins to a baker and gets a muffin. The muffin is a —
Carlos pays a person to mow his family's lawn. That is an example of a —
Which of these is a GOOD that you can hold?
Recap
People trade money for goods and services. A good is something you can hold in your hands, like bread or shoes, while a service is a helpful action a person does for you, like a haircut or a checkup. Both goods and services cost money.
Reflect
What is one service someone has done for you that you were thankful for?