INTRODUCTION TO

ECONOMICS
BY: MARLON D. SALIOT
TEACHER I
JHS KITUBO NATIONAL HIGH SCHOOL
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SEIPRENRTE
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ANDL
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RBOLA
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APITLCA
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YTCARCIS
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NOCOCIMSE
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TEKRAM
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ARECCS
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CESRERSOU
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UTLARNA
LEARNING OBJECTIVES
• 1. Identify basic economics problems of the country
• 2. Discuss the economic problems affecting the economic stability of the
country.
• 3. Analyze and explain the root cause of the economic problems of the country
• ABM_AE12-Ia-d-1
WHAT IS ECONOMICS
• Is a social science concerned with using scarce resources to obtain the
maximum of the unlimited wants of society.
• Is the study of how societies use scarce resources to produce commodities
and distribute them among different people.
• Is the study of production, distribution, selling ang use of goods and service.
• Is the study of how people use their limited resources to try to satisfy
unlimited wants.
• Scarcity- the limited nature of resources, which underlies the basic
economic problem.
• Economic Resources- the problem of having unlimited wants, but
limited resources to satisfy them.
• Natural Resources- came from nature that are used in production,
including land, raw materials, and natural process.
• Capital Resources- the processed materials, equipment, and
buildings used in production.
• Human Resources- the efforts of people
involved in production, including labor and
entrepreneurship.
• Needs – the essentials of life, such as food and
shelter .
• Wants –desires for non-essential items.
SCARCITY
• Is a condition where there are insufficient resources to satisfy all the
needs and wants of a population.
• Scarcity- is the reason why people have to practice
economics.
• Economics- as a study, is the social science that involves
the use of scarce resources to satisfy unlimited wants.
ALFRED MARSHALL

• Described economics as study of mankind in the

ordinary business life.
• It examines part of the individual and social action that
is most connected with the attainment and use of
material requisites of well-being.
 TWO TYPES OF SCARCITY

• Relative Scarcity- is when a good is scarce compared to

its demand.
• Absolute Scarcity- is when supply is limited
 CHOICE AND DECISION MAKING
• Because of the presence of scarcity, there is a need for
man to make decisions in choosing how to maximize
the use of the scarce resources to satisfy as many wants
as possible.
• Opportunity cost –Refers to the value of the best
foregone alternative.
ECONOMIC RESOURCES

•Land
•Labor
•Capital
 ECONOMIC RESOURCES
• Land –Soil and natural resources that are found in nature and are not manmade.
Owners of lands receive payment known for rent.
• Labor – Physical and human efforts exerted in production. It covers manual workers
like construction workers, machine operators and production workers, as well as
professionals like nurses, lawyers and doctors.
• Capital –Man-made resources used in the production of goods and services which
include machineries and equipment. The owner of capital earns an income called
interest.
 ECONOMIC AS SOCIAL SCIENCE

• As a social science, economics studies how individual

make choices in allocating scarce resources to satisfy
their unlimited wants.
 TWO BRANCHES OF ECONOMICS

•Macroeconomics
•Microeconomics
 TWO BRANCHES OF ECONOMICS
• Macroeconomics – is a division of economics that is concerned with the
overall performance of the entire economy

• Microeconomics –studies the decision and choices of the individual units

and how these decisions affect the prices of goods in the market.
• It also concerned with the process of setting prices of goods that is also know
as Price Theory.
 BASIC ECONOMIC PROBLEMS OF SOCIETY

•What to produce and how much

•How to produce
•For whom to produce
 BASIC ECONOMIC PROBLEMS OF SOCIETY

WHAT TO PRODUCE AND HOW MUCH

• Society must have to decide what goods and services
should be produced in the economy. Having decided
on the nature of goods that will be produced, the
quality of these goods should also decided on.
 BASIC ECONOMIC PROBLEMS OF SOCIETY

HOW TO PRODUCE
• Is a question on the production method that will be
used to produced the goods and services. This
refers to the resource mix and technology that will
be applied in production.
 BASIC ECONOMIC PROBLEMS OF SOCIETY

FOR WHOM TO PRODUCE

• Is about the market for goods. For whom will the
goods and services be produced? The young or old,
the male or female market, the low-income or the
high income groups?