APPLIED-ECONOMICS-as-applied-and-social-science (1).pptx

Applied economics

1. APPLIED ECONOMICS Economics as a Social Science and Applied Science In Terms of Nature and Scope

2. C

3. D

4. C

5. A

6. B

7. SCOMICONEORIMC MICROECONOMICS

8. OSODGELBNGIAT TANGIBLE GOODS

9. YRACTISC SCARCITY

10. UXURYLDOOGS LUXURY GOODS

11. MOONECICS ECONOMICS

12. PITACAL CAPITAL

13. ECONOMICS Think of the words that are related to economics

14. WHAT IS YOUR FAVORITE? FOOD SHOES K-POP GROUP BAGS SHIRT SUBJECT DRINKS DESSERT

15. Every day we meet people with different personalities. Each of them has their own preferences as to what they are going to wear, what food they will eat, etc. However, we cannot get all what we want because the resources are limited. We have to look for the best alternative at the least cost which gives a better benefit to us. These two aspects, choice and decision-making, are the main focus of economics.

16. WHAT IS ECONOMICS? Economics is from the Greek words oikos which means household or family and nonos meaning management. During the ancient times, family is the most observed organization. Oikonomos includes the management of wealth and customs of the family which later on form part of the society

17. What is Economics? Economics is the use or allocation of scarce resources to meet man’s unlimited needs and wants. – Richard Lipsey Economics is the study of how people allocate scarce resources for production, distribution, and consumption, both individually and collectively.

18. Terms Related to Economics Economics is ultimately concerned with why, when, and how human beings trade with each other in a society. Needs are important for the human being to survive. The basic needs, according to Abraham Maslow, are the physiological needs such as food, house, water, air, and clothing. Any type of automobile or transport is a need today especially during this pandemic or emergency. On the contrary, wants are something that you wish to have, so as to add comforts in your life. Luxury car, branded shoes, mansion, high-end mobile phones, traveling abroad are considered as wants.

19. Choice involves selecting and decision-making. It is considered as the ultimate power of human. Resources are natural, i.e. land, air, water, minerals, and man-made materials, i.e. capital, machinery and the like. Proper management, distribution and allocation of resources will suffice the welfare of human and society.

20. Economic Goals Efficiency and Full Employment Efficiency means the ability to produce a desired result with the least cost possible or without any waste. It is achieved when society is able to get the greatest amount of satisfaction from the available resources. Since resources are limited, it is difficult to convey back all the resources wasted. With efficiency, society cannot change the way resources are used in any way that would increase the total amount of satisfaction obtained by society. The scarcity problem will lessen if there is an efficient way of using the resources. Same with efficiency, full employment is an economic situation when all available labor resources are wholly utilized. In reality, full employment is impossible to achieve because of job mismatch-the available jobs in the market are not suitable to the skills that they are looking for. However, the economist and policy makers will ensure that the labor resources are maximized.

21. Equity There’s a confusion between the word equity and equality and sometimes interchanged. Equity treats a valuable support to achieve fairness and greater outcomes while equality upholds equal opportunity among others. Both equity and equality manifest in the government program like Pantawid Pamilyang Pilipino Program (4Ps) and government subsidies, respectively. In 4Ps, the identified beneficiaries are receiving financial assistance to meet their basic needs. While this program is not intended to the households which can cope with the everyday living. Government subsidies on food, gasoline, and other necessities may enjoy by the citizens, rich or poor, without any restrictions. Equity is achieved when income and wealth are fairly distributed within the society. Almost everyone wants a fair distribution. However, what constitutes a fair and equitable distribution is really mystifying.

22. Stability Economic stability refers to the strong macroeconomic foundation where employment, production, and prices are firm and constant. This goal seeks to avoid not only on the fluctuation of prices in the market but the emphasis is on recessionary declines and inflationary expansions of business cycles. To determine if the economy achieved stability, there are certain measures— unemployment rate, inflation rate, and the overall production (GDP). It is important for the economy to maintain stability because the households and business can secure their consumption and production, respectively. This also leads to economic security wherein there are stable income and the society enjoys the economic freedom.

23. Economic Growth Economic growth refers to the situation wherein there is an increase in the overall output or production. The economy is able to produce more of the goods and services in a given time. This can be measured by comparing the GDP of the previous year to the latest data. Economic growth is also indicated by increases in the quantities of the resources. If this goal is achieved, there are many products available in the market and the society has the freedom to choose and to satisfy more wants and needs-people are better off; living standards rise; and scarcity is less of a problem.

24. Is Economics a Social Science? Social Science is the branch of science devoted to the study of societies and the relationships among individuals within those societies.

25. It’s all about choices… Scarcity is the insufficiency or inadequacy of economic resources and as a result, we have to decide and choose. *Scarcity is a condition of why people study and practice economics.

26. Why do we have to choose? *Consumers cannot spend money twice. Ex. Money spent on a cellphone cannot be spent again on buying a TV. *Producers cannot use resources again once they are used up. Ex. A farmer who decides to use his land for producing corn gives up the opportunity to produce rice.

27. Law of Scarcity An economic system cannot produce all goods and services that consumers want, and most consumers do not have the resources to purchase everything they want.

28. Since there is scarcity, we have to choose… Trade-off – the exchange or choosing between alternatives. It is a reality of life that getting one thing would mean giving up another thing. House renovation Buying a car vs

29. Since there is scarcity, we have to choose… Opportunity Cost – the value or cost of the next best forgone choice/alternative. Working mother Full-time mother In other words, opportunity cost represents the benefits that could have been gained by taking a different decision. Opportunity cost: salary

30. Since there is scarcity, we have to choose… Opportunity Cost – the value or cost of the next best forgone choice/alternative. Working mother Full-time mother In other words, opportunity cost represents the benefits that could have been gained by taking a different decision. Opportunity cost: salary

31. Positive and Normative Economics Positive Economics describes and explains various economic phenomena or the “what is” scenario. Positive economics is based on facts. Ex. “Public healthcare increases government expenditures.” Normative Economics focuses on the value of economic fairness, or what the economy “should be”. In other words, normative economics is based on value judgements. Ex. “Best healthcare must be free to all citizens.”

32. What are the branches of Economics? Microeconomics Concerned with the decision-making done by smaller economic units such as individuals or consumers, firms and industries. It is also concerned with the process of setting prices of goods that is also known as Price Theory. Macroconomics Study of the large economy as a whole or the aggregate economy.

33. Microeconomis VS Macroeconomics MICROECONOMICS Studies individual income Analyzes demand and supply of labor Deals with households and firms decisions Studies individual prices Analyzes demand and supply of goods MACROECONOMICS Studies national income Analyzes total employment in the economy Deals with aggregate decisions Studies overall price level Analyzes aggregate demand and aggregate supply

34. What is Supply and Demand? Supply – refers to the total number of goods or services available for sale. Resources refers to the factors or inputs of production.

35. Picture Analysis Directions: Examine the pictures then complete the sentence by choosing the letter that corresponds to the correct answer.

36. 1. Pictures are examples of_______. a. Resources b. commodities

37. 1. Pictures are examples of_______. a. Resources b. commodities

38. 2 . Pictures are examples of_______. a. land b. resources

39. 2 . Pictures are examples of_______. a. land b. resources

40. What is the difference between resources and commodities?

41. Resources and Commodity Economic Resources are the factors used in producing goods or providing services. Ex: labor, land, assets, capital A commodity is an economic goods and are often used as inputs in the production of other goods or services.

42. 3 . Pictures are examples of_______. a. wants b. needs

43. 3 . Pictures are examples of_______. a. wants b. needs

44. 3 . Pictures are examples of_______. a. wants b. needs

45. 3 . Pictures are examples of_______. a. wants b. needs

46. Human Needs and Wants A human needs are something that you must have in order to live Human wants are something that you wish to have to add comfort to your life.

47. Factors of Production In economics, the factors of production (sometimes called economic resources or inputs ) are essential to produce goods and services. These are… LAND LABOR CAPITAL ENTREPRENEURSHIP FACTORS OF PRODUCTION

48. Factors of Production Land - natural resources available to create supply such as raw materials that comes from the ground. LABOR CAPITAL ENTREPRENEURSHIP FACTORS OF PRODUCTION

49. Factors of Production LAND LABOR CAPITAL- the money that companies used to buy resources; man-made objects like machinery, equipment and chemicals that are used in production. ENTREPRENEURSHIP FACTORS OF PRODUCTION

50. Factors of Production LAND LABOR CAPITAL ENTREPRENEURSHIP Develops an idea into a business. FACTORS OF PRODUCTION

51. Factors of Production LAND Labor is the work done by people- education, skills, and motivation and productivity. CAPITAL ENTREPRENEURSHIP FACTORS OF PRODUCTION

52. GOODS yields your satisfaction. It is anything used to satisfy your wants and needs. TANGIBLE GOODS are material goods or commodities. INTANGIBLE GOODS are in the form of services. Those rendered by doctors, engineers, doctors and other professionals.

53. CLASSIFICATION OF GOODS

54. CLASSIFICATION OF GOODS CONSUMERS GOODS – goods for the ultimate consumption of the consumers. Ex.: toothpaste, bath soap, etc.

55. CLASSIFICATION OF GOODS CAPITAL GOODS or INDUSTRIAL GOODS -used in the production of other goods and services. Ex.: buildings, machinery, equipment.

56. CLASSIFICATION OF GOODS ESSENTIAL GOODS- used to satisfy the basic needs of man. Example: foods and medicine

57. CLASSIFICATION OF GOODS LUXURY GOODS – goods man may do without, but may give comfort and satisfaction. Ex., perfume, cakes; chocolates, expensive cars.

58. CLASSIFICATION OF GOODS ECONOMIC GOODS – goods which are useful and scarce; with value attached to them and a price has to be paid for their use. If a good is so abundant and it can satisfy everyone’s needs without anybody paying for it, then, that good is free. The air is free, but the air from an aircon is an economic good.

59. What are the factors of production?

60. How can studying economics help you as a student?

61. What have you learned today?

62. Which term refers to effective management of scarce resources to satisfy unlimited human wants and needs?

63. Which term refers to limitation of resources?

64. Which branch of economics is concerned with the overall performance of the entire economy?

65. What do you call the skill that develops ideas into a business?

66. What are the natural resources available to create supply such as raw materials that comes from the ground?

67. Search a recent case in which a decision by the Philippine government was constrained by the scarcity of resources.