Republic of the Philippines

CEBU NORMAL UNIVERSITY

Osmeña Blvd, Cebu City, Cebu 6000
(032)253-7915, (032)254-1452, (032)254-6814
www.cnu.edu.ph

Name: Lysha Fleur Amores Date: October 08, 2021

Year & Section: BSED Social Studies 3B Schedule: TTH 1:30-3:00 PM
Course Subject: Introduction to Macroeconomics Professor: Atty. Lorenil Archival
MIDTERM EXAMINATIONS IN MACROECONOMICS
(Atty. Lorenil A. Archival)
Instructions:
The examination is composed of enumeration, true or false, and essay.
Answer the Essay questions legibly, clearly, and concisely. Start each
number on a separate page. An answer to a sub-question under the
same number may be written continuously on the same page and the
immediately succeeding pages until completed.
Your answer should demonstrate your ability to analyze the facts, apply
the pertinent laws and jurisprudence, and arrive at a sound or logical
conclusion. Always support your answer with the pertinent laws, rules,
jurisprudence, and the facts.
A mere "Yes" or "No" answer without any corresponding explanation or
discussion will not be given full credit. Thus, always briefly but fully
explain your answers although the question does not expressly ask for
an explanation.
After answering the questions, upload your answers via this Google
Drive:
https://drive.google.com/drive/folders/1Z237abmiNR7Cq1vskJ4Q3wVW
DdqEKa62?usp=sharing
 Republic of the Philippines
CEBU NORMAL UNIVERSITY
Osmeña Blvd, Cebu City, Cebu 6000
(032)253-7915, (032)254-1452, (032)254-6814
www.cnu.edu.ph

I.
Define inflows and outflows? (5 points)
Inflow refers to the money that enters a business through sales,
investments, or financing. It is the polar opposite of outflows, which is
defined as when money leaves a company, such as taxes, debt, wages,
etc. Businesses earn cash, and at the same time, they lose it. A
business's financial performance is safe if there is a greater inflow than
outflow.

What is the meaning of multiplier effect in matters of economic circular

flow? (5 points)
The multiplier effect is like a domino effect where an initial
stimulation causes a series of reactions. It shows how much an initial
investment can grow the economy from the amount invested. The
circular flow model shows how money is just a cycle driving in many
aspects of society, such as government, producers, and employees.
Money moves from the government through funds, producers to
employees as wages, then back to the government by paying taxes. The
multiplier effect and economic circular flow go hand in hand as they
create a series of reactions and form a cycle.
 Republic of the Philippines
CEBU NORMAL UNIVERSITY
Osmeña Blvd, Cebu City, Cebu 6000
(032)253-7915, (032)254-1452, (032)254-6814
www.cnu.edu.ph

II.
What is macroeconomics? (5 points)
Macroeconomics is the study of the economic activities that affect the
entire economy, such as the total amount of goods and services produced
and the level of unemployment, etc. The importance of studying and
understanding macroeconomics is for us to know and understand the
issues and policies implemented to achieve a certain level of economy in
a country. Like microeconomics, it is concerned with the
decision-making processes. Still, the big difference is that it looks at the
decisions of various economic sectors such as households, governments,
and firms.

Differentiate macroeconomics to microeconomics. (5 points)

the
Economics is divided into two branches: macroeconomics and
microeconomics. Macroeconomics look at the economy of a country as a
whole. Inflation, gross domestic product (GDP), and unemployment are
all studied in macroeconomics. Microeconomics is on the smaller scale of
looking at the economy. It is about how an individual consumer or one
company makes their own decisions such as what they will buy, how
many they will buy, what their job is.
 Republic of the Philippines
CEBU NORMAL UNIVERSITY
Osmeña Blvd, Cebu City, Cebu 6000
(032)253-7915, (032)254-1452, (032)254-6814
www.cnu.edu.ph

III.
What are the different economic resources? Define each and provide
examples? (10 points)
The economic resources are the basic needs for production, such
as land, labor, capital, and entrepreneurs. Land is rich in natural
resources such as minerals, water, and land used for production. It is
also a place for production to collect rent or mortgage and space for
factories and other industries to produce products and services. Labor is
the skills and services of an individual that are required for production.
Businesses need labor to increase productivity and to keep up with the
demand. Capital refers to the purchasing of goods and services using
money that is needed for production. Entrepreneurs are the risk-takers
of a business that may succeed or fail, both from large businesses to
small businesses. Without them, there is no economic growth as they
initiate ideas of goods and services for investors to invest in.
 Republic of the Philippines
CEBU NORMAL UNIVERSITY
Osmeña Blvd, Cebu City, Cebu 6000
(032)253-7915, (032)254-1452, (032)254-6814
www.cnu.edu.ph

IV.
What are the types of economic systems? Define each. (5 points)
The traditional economic system is out of the other system is the
traditional and basic system that is the basic way of handling the
economy that has been around for centuries without being dependent on
technological advancement. An example of a traditional economic system
is agriculture and fishing, which is usually the livelihood of many
families in developing countries.
In a command system, the government is the authority that is in control
of the economy. In communist countries, it is up to the government of
how they handle their economy. Compared to other systems, command
economies are rigid and inflexible, which means they cannot handle
change.
In a market economy, a country's individual citizens and businesses
determine economic activities and the pricing of goods and services with
little interference from the government. Thus, The majority of economic
decisions are being made through voluntary decisions that follow supply
and demand laws.
A mixed economic system allows private ownership and also offers some
economic freedom over its resources, but it also allows governments to
intervene in economic activity for regulations. Countries with mixed
economic systems have privately owned businesses while the government
controls public services.

What type of economic system is applicable in the Philippines? Why do

you say so? (5 points)
The Philippines has been a mixed economy for years, which means
privately owned businesses are following government regulations. I
would stick to a mixed economy to avoid more conflict in society,
business, and politics that are presently turbulent. A mixed economy
might elevate social welfare if the government has a share and thus is
obliged to support industries such as healthcare, education, and other
social programs.
 Republic of the Philippines
CEBU NORMAL UNIVERSITY
Osmeña Blvd, Cebu City, Cebu 6000
(032)253-7915, (032)254-1452, (032)254-6814
www.cnu.edu.ph

V.
Define and distinguish demand and supply? (5 points)
Demand is the amount of goods and services wanted by the buyer and
their willingness to buy a product or service at a given amount of price.
Supply refers to the amount the market can offer goods and services to
its buyers in exchange for a price. There is an inverse relationship
between supply and demand. The higher a good's price is, the less people
will demand it, and the lower a good's price is, the more people will
demand it. In other words, the higher the price, the lower the quantity
demanded. But also, the higher the price, the higher the quantity
supplied because suppliers think that if there is a high price, then there
is a high opportunity cost.
 Republic of the Philippines
CEBU NORMAL UNIVERSITY
Osmeña Blvd, Cebu City, Cebu 6000
(032)253-7915, (032)254-1452, (032)254-6814
www.cnu.edu.ph

VI.
True or False:
1. An increase in price tends to make consumer buy less and sellers
to sell more. A price decrease tends to cause the opposite reaction.
(2 points) True
2. The demand for a product is defined as the quantity that buyers
are willing to buy. The demand schedule shows the quantity of the
product demanded by a consumer at any given rate. (2 points)
True

3. The increase or decrease in the entire demand is shown through a

shift of the entire curve. This is referred to as a change in demand.
(2 points)True

4. The supply of a product is defined as the quantity that sellers are

willing to sell. The supply schedule shows the quantities that are
offered for sale at various prices. (2 points) True

5. The supply curve is upward sloping from left to right. The demand
curve is downward sloping from left to right. (2 points) True