SLK 2

GRADE 12 APPLIED ECONOMICS

QUARTER 1

Competency Differentiate economics as social science and applied science in terms of

nature and scope
Objectives a. Define and analyze the nature and scope of economics as social
science and applied science;
b. Distinguished Economics as social science and applied science;
c. Elaborate on the relationship between scarcity and man’s need to
choose;
d. Share insight on the relevance of economics to one’s life;
e. Justify the importance of making rational choice visa a vis to that of
resource utilization.

Topic/Subjec Nature and Scope of Economics as a Social Science and Applied Science
t Matter
Materials MELC, LM, TG
Copyrights DepEd Talisay City
Date November 23-27, 2020

I. CONTENT MAP

SOCIAL SCIENCE APPLIED ECONOMICS APPLIED SCIENCE

UNLIMITED NEEDS AND

LIMITED RESOURCES ECONOMIC PROBLEM WANTS

SCARCITY

ALLOCATION

II. CONTENT NOTES

 Economics is the science that deals with the management of scarce resources. It comes
from two Greek words: Oikos which means “household”, and nomus which means “system
or management”. Oikonomia or oikonomus, therefore, means the management of
household.
 Economics is the queen of all social sciences. It is closely related to other sciences like
business management, history, finance, physics, sociology and psychology.
 Social Science analyzes human behavior while taking the results of the other groups of
sciences as a description and explanation on human environment.

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 Applied Science is the discipline dealing with the application of scientific knowledge to
problems in order to develop practical solutions.

 Scarcity is the basic and central economic problem confronting every society due to
unlimited needs and wants.
 Ceteris Paribus means “all other things held constant” or “all else equal”.
 Positive Economics is an economic analysis that considers economic conditions “as they
are” while normative economics is an economic analysis which judges economic conditions
“as these should be”
 The Four Basic Economic Questions:
 What to produce?
 How to produce?
 How much to produce?
 For whom to produce?
 The three (3) important E’s in economics are efficiency, equality and effectiveness

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  Microeconomics is the branch of economics that deals with the individual decisions of the
units of the economy – firms and households – and how their choices determine relative
prices of goods and factors of production.
 Macroeconomics is the branch of economics that studies the relationship between broad
economic aggregates.
 The Four Sectors of the economy: The behavior of the aggregate household
(consumption); the decision-making of the aggregate business (investment); the policies and
projects of the government (government spending); and the behavior of the external/foreign
economic agents through trading (export and import)
 Opportunity Cost refers to the foregone value of the next best alternative. It is the value of
what is given up when one makes a choice.
 The Factors of Productions are land, capital, labor, and entrepreneurship.
 The basic decision problems are consumption, production, distribution and growth overtime.
 The production Possibilities Frontier represents an outcome or production combination
that can be produced with a given amount of resources.

III. ACTIVITIES:

Activity 1: IDENTIFICATION

Direction: Fill in the blank with the correct answers.

1. _________________ is the branch of economics that studies the behavior of the economy as
a whole.
2. _________________ is the science that studies chemical and physical processes.
3. _________________ refers to the creation of utility.
4. _________________ is the study or discipline that aims to explain human behavior.
5. _________________ is the study of economics relative to real-life situations.
6. _________________ represents an outcome or production combination that can be
produced with a given amount of resources.
7. _________________ means “all other things held constant”.
8. If there is no scarcity, there should also be no _______________.
9. A society must also take into account the resources that it possesses before deciding what
goods or services to ______________ .
10. Positive economics simply answers the question “________________?”.
11. The Greek word oikos means ____________________ .
12. __________________ refers to the scarce resources in demand.
13. Economics comes from the Greek term __________________.
14. __________________ refers to economics “as it should be”.
15. __________________ is the science that manages limited resources in demand.

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ACTIVITY 2: ENUMARATION

Directions: List down your answers in the spaces provided.

What are the four factors of production ?
1. ________________________________
2. ________________________________
3. ________________________________
4. ________________________________

What are the 3 E’s in economics?

1. ________________________________
2. ________________________________
3. ________________________________

What are the four basics economic questions?

1. ________________________________
2. ________________________________
3. ________________________________
4. ________________________________

What are the four major sectors of macroeconomics?

1. ________________________________
2. ________________________________
3. ________________________________
4. ________________________________
ACTIVITY 3: Did I Do It Right or What?
Instruction: Read and comprehend the situations below. Now that you are familiar with the concept of
Scarcity, Choice, and Opportunity Cost. Evaluate if the characters did make a rational decision or not
and put a checkmark on the box. Write a brief and concise elucidation on it.

1. At an early age, Jessie lost both his parents in an accident. For years now, he has been staying
with his grandmother who took care of his needs. After graduating from college, he landed a job
in one of the companies in MEPZA. He also served as a part-time delivery man. Every payday,
he made sure that 1/2 of his income will be spent on household needs and 1/3 goes to savings
and will be his allowance.
RATIONAL IRRATIONAL
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2. Jay was invited by Jose to accompany him to the casino. At first, he was just watching Jose,
enjoy playing the slot machine. He was amazed by how much Jose won. He was tempted to try
and asked Jose to teach him. Without knowing Jay spent all his money, nothing was left.
RATIONAL IRRATIONAL
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3. Lorna works as a secretary in one of the offices in LSM Tower. She wanted to buy a MacBook
Pro (a laptop made by Apple Inc.) for her office works. All her friends have one. She has been
saving money for years. One day, she went to a computer store and inquired about her favorite
laptop. She brought the money with. The sales agent inquired about the reason and purposes of
why Lorna is buying a laptop. After learning it, the agent recommended to Lorna other brands
which are way cheaper than MacBook Pro. Convinced, Lorna bought the other laptop. She was
happy with the decision and at the same time, she still has much money left.
RATIONAL IRRATIONAL
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4. During the ECQ, many workers lost their jobs. Maria’s husband Jomar was among those
workers. Normally there was abundant food on the table. The family often shared various viands
like fried chicken, adobo, Bulalo, and others. The couple decided to spend wisely the remaining
money by buying less meat and more vegetables.
RATIONAL IRRATIONAL
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5. Julius is never keen on spending money on objects he likes brought about by spur of the
moments whenever he goes to the mall or on non-essential things. He closely examines if such a
thing is indeed needed or not.
RATIONAL IRRATIONAL
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IV. EVULATION: Multiple Choice
Directions: Encircle the letter of that corresponds to the correct answer.
1. The following statement supports the concept of ceteris paribus except:
a. All other things held constant
b. A device to analyze the relationship between two variables
c. As it should be
d. All else equal
e. It allows economist to isolate the relationship between two variables

2. Examine the following statements.

I. Microeconomics operates at the level of the individual business firm, as well as that of
the individual consumer.
II. Microeconomics is the branch of economics that deals with individual decisions of units
of the economy; firms and households.
III.Microeconomics is the branch of economics that studies the relationship among broad
economic aggregates.

a. True, True, True c. False, True, False e. False, False, True

b. True, False, True d. True, True, False

3. Arrange the following statements.

I. We can define economics as the efficient allocation of the scarce means of production
toward the satisfaction of human needs and wants.
II. We cannot produce everything that we want since there is scarcity or limitedness of
resources.
III.The definition of economic contains an important phrase – scarce means of production –
which refers to our economic resources like land, labor and capital.
IV. We do not have enough resources to produce all the goods and services that we
desire.

a. I, III, IV, II b. I, II, III, IV c. IV, III, II, I d. I, IV, II, III e. III, I, IV, II

4. It refers to the basic and central economic problem confronting every individual in society.
a. Oikos b. Scarcity c. Nomus d. Household e. System

5. This broadly refers to all resources found in nature and are, therefore, not man-made.
a. Capital b. Entrepreneurship c. Labor d. Land e. Production

6. This refers to any form of human effort exerted in the production of goods and services.
a. Capital b. Entrepreneurship c. Labor d. Land e. Production
7. These are man-made goods used in the production of other goods and services.
a. Capital b. Entrepreneurship c. Labor d. Land e. Production

8. It refers to a person who organizes, manages, and assumes the risks of a firm suppliers are
brought and sold.
a. Capital b. Entrepreneurship c. Labor d. Land e. Production

9. It refers to a person who organizers, manages, and assumes the risks of a firm, develops a
new idea or product, and turns it into a successful business.
a. Market b. Households c. Business d. Resource Market d. Land

10. It is the place where goods and services produced by businesses are bought by and sold to
the households.
a. Market b. Households c. Business d. Resource Market d. Land
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11. It refers to the productive and proper allocation of economic resources.
a. Economics b. Effectiveness c. Equity d. Efficiency e. Equipment

12. Which refers to the attainment of goals and objectives?

a. Economics b. Effectiveness c. Equity d. Efficiency e. Equipment

13. It refers to justice and fairness.

a. Economics b. Effectiveness c. Equity d. Efficiency e. Equipment

14. It is forgone value of what you give up when you make choices.
a. Command Economy c. Market Economy e. Opportunity Cost
b. Macroeconomics d. Microeconomics

15. Examine the following statements.

I. Macroeconomics focuses on the four sectors of the economy: aggregate household,
business, government, and externals.
II. Among the topics discussed in macroeconomics are the principles of demand and supply
and the elasticity of demand and supply.
III. Macroeconomics also discusses the measurement of gross national product and gross
domestic product.

a. True, True, True c. False, True, False e. False, False, True

b. True, False, True d. True, True, False

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V. REFERENCES

[ CITATION Edi17 \l 13321 ]

VI. ANSWER KEYS

VII. ADDITIONAL READINGS

Enriquez, H C (2020). Basic Economic Problems of the Country. Retrieved on June 01 2020 from
https://www.slideshare.net/HannahCullen/lesson-3-basic-economic-problems

Molina, J. A. & Nadal, G. J I (2020) Concept and Scope of Economics. Retrieved on June 01 2020
from http://personal.unizar.es/jamolina/Unit1.pdf

Pretty, N (2020). Basic terms in Economics. Retrieved on June o1 2020 from

https://www.slideshare.net/nikspretty/basic-terms-in-economic

Portillo, E.F (2017). Basic terms in Economics retrieved on June 01 2020 from
https://www.slideshare.net/enaportillo13/basic-terms-in-economics

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VII. FEEDBACK NOTES

LEARNER’S FEEDBACK
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PARENTS’/GUARDIANS’ FEEDBACK
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Prepared by:

VERGEL D. TORRIZO
MOHON (Divino Amore) NATIONAL HIGH SCHOOL

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