Supply-Demand and

Philippine Economic
Problems
THE PHILIPPINE PESO AND FOREIGN
CURRENCIES.
Trading with other countries is also an
important economic activity that impacts on
the economy. Selling locally made products,
called exports, means we earn dollars as
payment for these goods bought by foreign
buyers. In the same manner, we buy goods
from other countries, and these are our
imports. When we trade with other countries,
we need a common currency to use to pay for
goods we buy from them and for them to pay
us for goods we sell to them.
The rate of conversation of the Philippine
peso to a foreign currency is reflected in the
exchange rate. If we have pesos that we
need to convert into dollars, we need to
know the current exchange rate. These rates
are dependent on the working of demand for
and supply of the currency in the market. For
example, if the US dollar is in demand, the
price of the dollar will increase and will be
reflected in a higher exchange rate in favor
of the dollar, which means one will need
more pesos to buy dollars.
 HOUSING SHORTAGE AND THE REAL ESTATE
BOOM IN THE PHILIPPINES
 Demand and supply also play an important
role in the Philippine real estate situation.
In the late 1990s, during the Asian financial
crisis construction hit low levels in the
Philippines. Some high profile construction
projects were abandoned and demand for
housing was at a low level. Some real
estate companies even had to close. This
was the effect of decreased demand for
construction projects.
 RENT AND PRICE STRUCTURE
The layman’s concept of rent is payment for the use of
land or buildings belonging to others. It is the
compensation made to the owner of such land or
building. From the point of view of economics, rent
refers to a peyment made to or for a facrot of
production over and above the amount expected by its
owner. Economic rent is the positive difference between
the actual payment made for a factor of production
(such as land, labor, or capital) to its owner and the
payment level expected by the owner, due to its
exclusivity or scarcity. Economics rent exists due to
market imperfections. Without market imperfections,
there would be no need for payment of rent.