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Introduction to

Applied

Economics
 Introduction to Applied
Economics

Revisiting Economics as a Economics as an

social science applied science

Basic economic problems and the

Philippinesocioeconomic development
in the 21st century
 1. Define basic terms in applied

economics
2. Identify the basic economic

problems of the country

Objectives: 3. Explain how applied

economics can be used to solve

economic problems
Activity 1:
Kindly arrange the following words. These are the terms you commonly
encounter when you make decisions of going to the market. Examples of

these items are given on the right column.

Activity 1:
Kindly arrange the following words. These are the terms you commonly
encounter when you make decisions of going to the market. Examples of

these items are given on the right column.

1. MIRECOOCNOMSCI
Activity 1:
Kindly arrange the following words. These are the terms you commonly
encounter when you make decisions of going to the market. Examples of

these items are given on the right column.

2. TENAGILBDSOOG
Activity 1:
Kindly arrange the following words. These are the terms you commonly
encounter when you make decisions of going to the market. Examples of

these items are given on the right column.

3. SARCITYC
Activity 1:
Kindly arrange the following words. These are the terms you commonly
encounter when you make decisions of going to the market. Examples of

these items are given on the right column.

4. UXDOOSLUGYR
Activity 1:
Kindly arrange the following words. These are the terms you commonly
encounter when you make decisions of going to the market. Examples of

these items are given on the right column.

5. CDAOTOASAGIP
WHAT IS

ECONOMICS?
Mankiw
Economics is the study of how

society manages its resources.

Hall and Leiberman
Economics is the study of choice

under the conditions of scarcity

Castillo
economics as the study of how

man could best allocate and

utilize the scarce resources of

society to satisfy his unlimited

want.
Webster
economics as a branch of

knowledge that deals with the

production, distribution and

consumption of goods and

services.
Sicat
A scientific study which deals

with how individuals and society

in general makes choices.

Macroeconomics
and
Microeconomics
Macroeconomics
Three important macroeconomic goals:

1 Economic Growth

2 High Employment

3 Stable Prices
Macroeconomics
The study of economy-wide phenomena

dealing with economics behavior of the

whole economy or its aggregates such as

the government and businesses.

Discussion of topics like gross domestic

product (GDP) inflation, unemployment,

and economic growth.

Microeconomics
The study of how households and firms

make decisions and how they interact

in markets.
It deals with the economic behavior of

individual units such as consumers,

firms, and the owners of the factors of

production.
 Micro and

macroeconomics

are intertwined.
 DIVISIONS OF ECONOMICS

Production Distribution Exchange Consumption Public Finance

The Economic Resources
1. Land
2. Labor
3. Capital
4. Entrepreneurship