ICT-ED INSTITUTE OF SCIENCE AND TECHNOLOGY LIPA

Mercedes Bldg. P. Torres St. Lipa City, Batangas 4217

(043) 757-4445 / (043) 757-5944

SHS DEPARTMENT
12 - ABM
Learning Module
In
APPLIED ECONOMICS
(SY. 2020-2021)

Instructor:
Jojie R. De Ramos
 WEEK 1
LESSON 1

REVISITING ECONOMICS AS A SOCIAL SCIENCE

OBJECTIVES

1. Define economics

2. Determine the importance of economics

3. Describe the nature of economics

ECONOMICS

- The word 'economics' comes from two Greek words, 'eco' meaning home and 'nomos' meaning management.
The subject has developed from being about how to keep the family accounts into the wide-ranging subject of
today.

o Study of what constitutes rational human behavior in the endeavor to fulfill needs and wants.
o Understanding how society allocates its scarce resources.
o Almost always, human activities involve economics.

ECONOMICS FROM DIFFERENT PERSPECTIVE

Fajardo – “Economics is the proper allocation and efficient use of available resources for the maximum
satisfaction of human wants”.
Nordhaus – “Economics is the science of choice. It studies how people choose to use scarce resources to
produce various commodities
Sicat – “Economics is a scientific study which deals with how individuals and society made general choices”
Webster – “Economics is a branch of knowledge that deals with production, distribution and consumption of
goods and services”

ECONOMICS IN A PROCESS MAY BE PRESENTED AS:

Unlimited wants  Scarcity  Choices

 ECONOMIC ACTIVITIES:
1. Earning money
2. Buying goods and/or service
3. Selling goods and/or service
4. Depositing and Withdrawing money in a bank

“ECONOMICS IS CLASSIFIED AS A SOCIAL SCIENCE BECAUSE IT DEALS WITH THE STUDY OF HUMAN’S LIFE
AND HOW HE LIVES WITH OTHER MEN”

ECONOMICS

MACROECONOMICS MICROECONOMICS

Deals with the economic behaviour of the
whole economy or its aggregates;
Businesses, Government, Household
Mainly discusses the gross national
product, level of employment, national
income, general level of prices, etc.
Deals with the economic behaviour of
individual units such as consumers, firms,
landowners, etc.
Mainly discusses the prices of commodities,
number of worker on a certain firm, individual
income, a company’s expenditure, etc.
 Factors of production - Inputs
- Capital
DIVISIONS OF ECONOMICS Refers to the process of - Labor
producing or creating - Entrapreneurship
goods needed or
PRODUCTION wanted by the Goods and Services - Outputs
households to satisfy Goods - Something you can see and
thier needs feel. Somthing you can use.
Service - Something done for
something else

Examples
Wholesale
Refers to the marketing of goods and Retail
DISTRIBUTION services to different economic outlets Personal Selling
Direct Marketing
E-Commerce

refers to the process of transferring

goods and service to a person in return You cannot legally acquire
EXCHANGE for something present medium of
something without giving
somthing in exchange
exchange - money
refers to the proper utilization of economic
goods. However, goods and services could not be
Acquisition of anything in
CONSUMPTION utilized unless you pay for it. Hence, consumption
the market
could also be spending money for goods and
services

pertains to the activities of the

government regarding taxation,
Taxes and how they are
PUBLIC FINANCE borrowings and expenditures. It deals being used.
with the efficient use and fair
distribution of public resources.
ECONOMIC RESOURCES
Land – These resources consist of free gifts of nature. It includes; soil, rivers, lake, oceans, forest, mountains, mineral
resources. It is considered as an economic resource because it has a price attached to it. Individuals usually pay
for it through rent or lease. Land is also a limited resource. Physical land is a fixed resource.
Labor – Also called human resource. It refers to all human efforts, be is mental or physical, that help to produce
satisfying goods and services. In return he earns an income in forms of wages and salaries. Labor is also a
flexible factor of production – workers can be allocated to different areas of the economy for producing goods and
services
Capital – There are two economic definitions of capital
a. it can represent the monetary resources used to purchase natural resources
Example: Companies use capital to buy land and other goods.
b. represents the major physical assets of individual and companies use when producing goods and
services
Example: Buildings, vehicles, equipment
Entrepreneurs – Organizer and coordinator of other factors of production; land, labor and capital. He is the one who
uses his initiative, talent and resourcefulness to create economic goods
Foreign Exchange – Refers to the dollar and dollar reserves that the economy has. It is part of the economic resources
because we need foreign currency for international trading and buying materials from other countries.
Name:___________________________________

Activity 1

ESSAY:

1. In defining Economics in different perspective, what are the major similarities of that you
observed?

2. Why do you think that almost in every economic activities, human is always involved?

3. Differentiate macroeconomics and microeconomics

4. In the division of economics, in which should we put most of our efforts in? Explain your
answer

5. In your own opinion which is the most important economic resource? Why do you say so?

Specific Instruction:

1. Write in a yellow pad of paper

2. Minimum of 200 words each essay

3. To be submitted on January 30, 2021