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Introduction. In every type of economy there are two sets of people that make the





In every type of economy there are two sets of people that make the

system work. These are producers and consumers.

Producers are the people who perform the work that provides goods

and services for society. This group includes not only those people who

work with their hands, but also those who start up and manage a busi-

ness. It also includes the investors who supply the money to initiate and

sustain business. Producers supply the products and services that are de-

manded by consumers.

24


 

 

Consumers are the people who buy the products and services pro-

vided by the producers. All producers are also consumers. That is, a per-

son who works in a factory making pens is a producer; when that same

person spends the money received for working to buy food, he or she is

a consumer. Similarly, the factory that produces pens is also a consumer.

Consumers are made up of individuals, families and households, busi-

nesses, and also government purchasers. Consumers play an important

role in most societies since they decide what they will buy, where they

will buy it, when, and from whom. Their decision about how they will

spend their incomes greatly affects what the producers will supply.

Products provided by businesses can be classified as standard prod-

ucts and custom products. Standard products are usually made in ad-

vance of sale to unknown customers. Toothpaste, for example, is made

in huge quantities without the producer knowing specifically who will

buy and when. Similarly, certain services are available continuously, like

telephone service and television entertainment. Custom goods are not

made until an order is placed, the customer usually has some latitude in

determining the specifications of the product. A custom-made suit, for

instance, will be cut to the buyer’s measurement and made of the mate-

rial that the buyer selects. So, “custom-made” means made according



to customer’s special requirement. You should differentiate it from the

word “customize” which means to change the appearance let’s say of a

bag in order to make it look special or unusual.

Products can be classified as standard and custom ones. What about

services? Can the same classification be applied here? Why/why not? Give

your reasons.

 

Text 2

The paragraphs of the text have been jumbled. Read the text and put them into the

correct order.






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