Earning an Income

When people do a job, they receive money in return. This money is called income. Think of income as a reward for your time and effort. Most adults have jobs where they work several hours a day to earn their income. Without income, it would be very hard to buy the things we need (like food and a house) or the things we want (like video games or ice cream). When you help a neighbor rake leaves and they give you $5, that$5 is your income!

There are two main ways to earn income in your community. Some people make goods. These are physical things you can touch, like a baker making bread or an artist painting a picture. Other people provide services. A service is an action someone does for you. For example, a doctor helps you feel better, or a bus driver takes you to school. Both the baker (making goods) and the doctor (providing a service) earn income for their hard work.

The amount of income a person earns often depends on how much they work. Many workers are paid by the hour. This means if they work more hours, they earn more money. We can use math to predict how much income someone will have. If a pet sitter earns $5 for every dog they walk, we can calculate their total income by multiplying the number of dogs by the price per dog.