APPLIED

ECONOMIC
S
PRAYE
R
RECAP:
What is GDP?
What is GNP?
Differentiate exclusive growth from inclusive
growth.
Who is Henry Tan Chi Sieng Sy Sr.?
WORD EQUATION

Solve the following words

to get the correct anwer.
 1. CONE – E SUMMER – M +INN – N +
COME =
CONSUMER INCOME
2. UNIT + MARY – M – ELASTICITY –
ITY =
UNITARY ELASTIC

3. SUPPER – PER + APPLY – AP + CURE –E +

LOVE – LO =
SUPPLY CURVE
4. PER + INFECT – IN + KINDLY _ KIND + E +
LAST + CRITIC – CRIT=
PERFECTLY ELASTIC

5. COMPLETE – ET ELEMENTARY –
ELE + GO + ODS =
COMPLEMENTARY GOODS
 LESSON OBJECTIVES:
At the end of this chapter, the students are expected
to:
a. describe and explain demand and supply curve;

b. Compare and contrast demand and supply;

c. appreciate the value of supply and demand dynamics

in real-life situation
 SUPPLY
AND
DEMAND
DYNAMI
CS
Identify the given sets
of pictures to solve the
hidden words.
SUPPLY
 WHAT IS SUPPLY?

A stock of a resource from which a

person or place can be provided
with the necessary amount of that
resource.
SUPPLY CURVE
WHAT IS SUPPLY CURVE?
It depicts the relationship between
quantity supplied of a good and the
changes that occur as the price of the
good changes, ceteris paribus, i.e. all
things being equal.
 FACTORS THAT
CAN SHIFT SUPPLY
CURVE.
 SIZE OF
INDUSTRY
1. SIZE OF THE INDUSTRY

An increase in the size of the industry

will shift the supply curve to the right
thus increasing the supply of goods.
TECHNOLOGICAL
PROGRESS
2. TECHNOLOGICAL PROGRESS

any technological progress

leads to increase in the supply
of goods.
EDUCATION
3. EDUCATION

as the level and quality of

education improves, it
impacts as well on the increase in
supply.
PRICE OF INPUTS
4. THE PRICE OF INPUTS

When the prices of inputs increase this

translates to lower supply and the shift is to
the left; however, when the prices of goods
of inputs decrease, this will result in more
supply and will shift the curve to the right.
PRICE OF RELATED
OUTPUT
5. THE PRICE OF RELATED
OUTPUTS

When the price of related outputs

increase, the supply of goods will
also increase and will shift the supply
curve to the right.
 ELASTICITY OF SUPPLY
ELASTICITY OF SUPPLY HAS FIVE
CATEGORIES
𝛜 = 0, PERFECTLY INELASTICS
𝛜 < 1, INELASTICS
𝛜 = 1, UNITARY ELASTIC
𝛜 > 1, ELASTIC
𝛜 = ∞ , PERFECTLY ELASTIC
 GOODS
FREE GOODS are available in large quantities,
ECONOMIC GOODS come at price whether goods
or bads
What is Demand?
An economic principle referring to a consumer’s desire to
purchase goods and services and willingness to pay a price
for a specific good or service.
 What is Demand Curve?

illustrates the amount of goods and

services that consumers plan to purchase
at any given
price. It can also happen that the demand
can shift to the right or left.
 FACTORS THAT CAN PRODUCE SHIFT
IN THE DEMAND CURVE
1. CONSUMER INCOME
as it increases, the quantity demanded of a good
normally increases as well.
2. POPULATION
As population grows, it also means that the quantity
demanded of the good at any given price also normally
increases.
3. CONSUMER PREFERENCES
if the consumer tastes shifts in favor of a particular
good then there also will be an increase in the demand
of that good.
4. THE PRICE AVAILABILITY OF RELATED
GOODS
A. COMPLEMENTARY GOODS

B. SUBSTITUTE GOODS
A. COMPLEMENTARY GOODS
B. SUBSTITUTE GOODS
 ELASTICITY
FIVE CATEGORIES OF DEMAND
OF ELASTICITY OF
DEMAND

1. Perfectly inelastic where E = 0.

2. Inelastic where E < 1.
3. Unitary elastic where [ŋ] = 1.
4. Elastic where E > 1.
5. Perfectly elastic where E = ∞.
ACTIVITY #3 IN APPLIED
ECONOMICS
Compare and contrast the
demand and supply. Use Venn
Diagram on another sheet of
paper.
3RD SUMMATIVE TEST IN APPLIED
ECONOMICS
THANK
S!