An invention factory

As a child, George Davison had a dream: he wanted to be a famous inventor, like Thomas Edison or Walt Disney. As a boy, he created many inventions in the tree house in his garden.

When Davison grew up his dream came true. In a giant warehouse in Pittsburgh, USA, he created a workspace with 16 areas based on different themes: a pirate ship, a giant robot, a race circuit for cars, etc. His employees include engineers, computer technicians and designers.

Today, his company, Inventionland, is the biggest invention factory in the United States. It creates thousands of new products every year.

Davison organizes school visits to his company. On these visits, school children learn to develop their creativity and their scientific curiosity. Above all, they learn to believe in their dreams.

The economy

The economy is all the activities involved in producing, selling and buying the products and services we require for our basic needs. These days, we think of things like a good education and good health care as part of our basic needs.

There are three main processes that make up economic activity: production, distribution and consumption. 

Companies

A company is an organization which offers products or services to customers in exchange for making a profit. 
A profit is financial gain. Some companies also provide products or services to help social causes. 
To carry out economic activity, companies need different resources:

• Human resources. These are the employees who work for the company.
• Material resources. These include the raw materials to make the products. They also include the machines, transport, new technologies, etc.
• Financial resources. This is the money a company needs to carry out its activities.

Types of companies

There are many types of companies. Companies can belong to different economic sectors. 

• Primary sector. These companies obtain resources from nature, for example, a mining company.
• Secondary sector. These companies transform raw materials into products, for example, a furniture company.
• Tertiary sector. These companies provide services, for example, a dentist’s surgery, a restaurant or a shop.

Organization of companies

A company is like a giant puzzle made up of different pieces. All the pieces are necessary for the company to work well. These pieces are called departments, and they each have a different function. Managers organize and coordinate the different departments.

• Purchases. This department buys the materials and services the company needs.
• Production. This department creates the product or service the company sells.

What is advertising?

Advertising is giving people information about a product or a service using advertisements. Advertisements are special messages. We hear them on the radio or on television, or read them in magazines or on the Internet. There are different types:

Advertising techniques

Advertisements use different strategies to make people interested in a product. 

Advertisements cost money. For example, famous people earn a lot of money when they advertise products on television. The cost is added to the final price of the products. 

• Repetition. Adverts often repeat the name of a product or service many times in a short space of time. For example, they repeat the same telephone number to contact.

Advertising campaigns

An advertising campaign is a series of activities that aim to generate interest and demand for a particular product or service.

Advertising campaigns are created by companies or institutions through their marketing departments. They aim to reach a target audience: the group of people who may be most interested in the message.

These campaigns deliver a meaningful and inspirational message about a product or service, and persuade people to buy it. 

The message often includes a slogan. This is usually a simple, memorable statement that summarizes the product or service.

Money

Thousands of years ago money did not exist. Instead, people used barter. Barter means exchanging one product for a different product. Over time, barter was replaced by money.
Money we earn is called income. People usually put their money into a bank account. We can pay for things in different ways.

Making a budget

A budget is a plan for spending income. The money we spend 
is called expenses. To make a budget we add up our expenses, 
for example, food, transport, clothes, etc. Then, we subtract the expenses from our income. The final amount is called a balance. 

Savings

Many people choose to save some of their income in order to pay for future needs. Money we keep for the future is called savings. Generally, people keep their savings in a bank. 

People save money for different reasons:

• to travel
• to buy a house or a car
• to pay for courses in education
• to have enough money for retirement 

Investments

When we invest our money, we use it in order to make a profit. This means we hope to receive more money from an activity than we spend on it. 

People who invest money make an investment. There are different types of investments, such as buying property or opening a business.

However, investments always involve some risk. When we invest our money, we don't always make more.