Lorenz E.

Lugtu
GAS – 12

APPLIED ECONOMICS WEEK 2 OUTPUT

ACTIVITY 1
Resources in the production (dress) Issues/Problem in the production
1. Fabric supply Lack of supply due to price increase
2. Design materials Lack of production from the supplier
3. Dressmaker Lack of personnel
4. Sewing machine Outdated or old machines

ACTIVITY 2
1. Lack of vaccine
2. Expensive essential goods
3. Limited SAP beneficiaries
4. Increased rate of unemployed citizens
5. Increased demand, limited resources

ACTIVITY 3
1. In this example, the travelers who are moving quickly through the boarding process are
probably: government officials who are seated in the executive area; and VIP passengers
waiting longer more in an inconvenient line. Other passengers mentioned in the choices
are not granted with “fast pass“, because loyal passengers are not that much remembered
due to the increase travelers that uses the airlines each day; while passengers who value
time and convenience could not pay additional fees for the said “fast pass” for the reason
that there are no additional fees for such privileges of effortlessly going through the
boarding process.
2. Procuring bicycle units through purchasing secondhand models in good condition and
then fixing its gears and reselling it in a greater condition. Furthermore, using parts of
other bicycles in great condition could contribute a great help in procuring additional
units. Choosing a supplier with an affordable and good material would also be a great
option.

ACTIVITY 4
a. Economic Growth is an increase in the ability to produce goods and services. Hence,
we are able to produce more, but it doesn't necessarily mean we do produce more.
Economic Growth is caused by the following: more resources, better resources, better
technology. Therefore, if we only had more resources, we could produce more goods and
 services and satisfy more of our wants. Thus, scarcity will be reduced, and we will attain
a greater satisfaction with more goods and services.
b. There are four ways that societies can improve the use of available resources to reduce
scarcity and obtain the maximum satisfaction possible. These ways are called the 4 Es of
economics namely: productive efficiency, allocative efficiency, equity, and full
employment.
- Productive efficiency can be defined as, or achieved by, producing at a
minimum cost. By producing at a minimum cost, fewer resources are used and
more can be produced. This reduces scarcity and gives us more satisfaction from
our existing resources. We can produce at a minimum cost and achieve productive
efficiency by: not using more resources than necessary; using resources where
they are best suited; using appropriate technology.
- The second way to use our existing resources to maximize society's satisfaction
is allocative efficiency. Allocative efficiency is using our limited resources to
produce: the right mix of goods; more of what people want; less of what people
don't want.
- The third way to use our existing resources to achieve the maximum satisfaction
possible is equity. Equity is a "fair" distribution of income, or goods and services.
Fair does not mean "equal". Would an equal distribution of income be good for
society? Would it be good if doctors were paid the same as janitors? Probably not.
If we paid doctors the same as janitors we would have few doctors, and they
would not put in the time needed to learn medicine.
- The last E is full employment. It is defined as using all available resources, not
just labor. This means that if we have full employment, we are using all of our
labor, factories, mines, fields, etc. Therefore, if we have full employment, we
produce more. If we have unemployed resources, we produce less. This is why
society strive for full employment because it reduces scarcity and helps achieve
the maximum satisfaction possible.
c. A second way for a society to handle scarcity is to reduce expectations. If we just didn't
expect so much, then there would be less scarcity. For example, gasoline is scarce as well
as the spaces on the roads; hence, the president initiate a program of sharing a car with
your neighbor and a law that there should be only one car for every two families. This
would reduce scarcity of gasoline and space on roadways. The option of reducing
expectations is one of the options that societies have for dealing with scarcity, but it is not
a very good option. Maybe during war time, if our president asks us to "share a car with
our neighbor", we would. But it is not a long-term solution to the problem of scarcity that
most of us would accept. Although it is an option that we should keep in mind.

ASSESSMENT
1. A
2. B
3. C
4. A
5. D

REFLECTION
- I understand that our resources were limited yet our wants were infinite; hence, scarcity is
inevitable and must be solve efficiently in order to protect the economy, the people, as well as
the resources for production.
- I realize that addressing scarcity in an efficient manner could improve not just our economy but
also our way of living because finding a way to solve it usually results to innovation.
- I need to learn more about how economists form strategic solutions to solve scarcity and how it
works in an applied aspect.