Consumers and Producers

Lesson Plan - Get It!

Audio:

You may have talked about producers and consumers in science when discussing living organisms.

In economics — the study of goods and services — producers and consumers have an entirely different meanings.

• What do you think producers and consumers are in an economic setting?

Producers are people that create, make, and sell a good or a service.

• A good is a product that can be bought and sold.
• A service is work that is performed for others.

The image of the baker, from the beginning of the lesson, is an example of a producer. The baker performs the service of making cakes, cookies, and bread. The cakes, cookies, and bread he makes are examples of goods.

• Can you think of another example of a producer?
• Does your example sell a good or a service?

Consumers are the people who purchase and use a good or a service. In the images above, the girl with the cake is an example of a consumer. Someone in her family purchased the cake for her birthday and she is about to eat it. The cake is an example of a good because it is a product, rather than a service, that was purchased.

• Can you think of another example of a consumer?
• Does your example purchase a good or a service?

Before moving on to the Got It? section, think about how producers and consumers are connected.

• Are producers and consumers independent of, or dependent on, one another?

When you are ready, move on to the Got It? section to see if you can identify examples of producers and consumers.