From Common Sense Economics eBook: What Everyone Should Know about Wealth and Prosperity
In a market economy, people who earn high incomes do so because they provide others with things they value more than their cost. If these individuals did not provide valuable goods or services, consumers would not pay them so generously. There is a moral here: If you want to earn a high income, you had better figure out how to help others a great deal. On the other hand, if you are unable or unwilling to help others in ways they value, your income will be low.
This direct link between helping others and receiving income gives each of us a strong incentive to acquire skills, develop talents, and cultivate habits that will help us provide others with valuable goods and services. College students study for long hours, endure stress, and incur the financial cost of schooling in order to become doctors, teachers, accountants, and engineers. Other people acquire training, certification, and experience that will help them become electricians, maintenance workers, or website designers. Still others invest and start businesses. Why do people do these things?
- In the video, Jerry recommends that Babu create an “authentic” Pakistani restaurant to attract more customers. It turns out, no one wants Pakistani food, and there are no customers. Based on the reading above, what is happening?
- What information are Babu’s potential customers giving him by not eating in his restaurant?
- At the start of the scene, he’s also having trouble making money serving American food. What lessons might Babu draw concerning his ability to add value as a restaurant owner? What actions might this cause him to take?
This reading is an excerpt from Certell’s Common Sense Economics eBook. Certell offers curriculum materials and eBooks free of charge for students and teachers. Click Here to download the Common Sense Economics Materials.
15, Feb. 2018, How to Make Money [Digital image]. Retrieved from <google.com>.