Application of Demand and Supply Analysis

Question 1

Labor supply (labor force)

Answer 1

is the portion of the population who are 15 years old and over willing and able to work, which include (1) those who are actively seeking work but have not found work and (2) those who are employed.

Question 2

The country’s ______________________ value is determined by the labor supply’s contribution to producing products and services.

Answer 2

gross domestic product (GDP)

Question 3

refers to the total monetary or market value of all finished goods and services produced within a country’s borders in a specific period

Answer 3

Gross Domestic Product (GDP)

Question 4

the real GDP divided by the population, refers to how much the economy produces on average per resident.

Answer 4

Output per capita

Question 5

are highly skilled workers working in low-paying or low-skill jobs and part-time workers who prefer to be full-time

Answer 5

Underemployed

Question 6

occurs when the economy has relatively low unemployment.

Answer 6

Full employment

Question 7

refers to people who have no jobs and are looking for work.

Answer 7

Unemployed

Question 8

four (4) types of unemployment and explain.

Answer 8

1. Frictional Unemployment - is created during the time required to bring together labor suppliers and demanders. This type of employment does not last long, resulting better match-up between employees and job.
2. Structural Unemployment - occurs when job seekers do not have the skills demanded, posing more problems than frictional unemployment since the unemployed may need retraining to develop the skills required.
3. Seasonal Unemployment - occurs due to seasonal changes in labor demand during the year.
4. Cyclical Unemployment - occurs when there is an increase in unemployment due to the recession phase in the business cycle, although it decreases during the expansion phase.

Question 9

refers to the lowest allowed wage paid to workers under the legislation and government policies

Answer 9

Minimum wage

Question 10

The government’s mandated __________ depend on the cost of living in the specific region or sector. The setting of such rates protects workers from being underpaid by their employers and guarantees a sufficient income to meet their basic needs.

Answer 10

minimum wage rates

Question 11

When wage increases, the number of laborers decreases as employers hire more employees when wages go down.

Answer 11

Labor demand

Question 12

__________follows the law of supply – when wage increases, the labor supply also increases, and vice versa.

Answer 12

Labor supply

Question 13

A ____________ could lead to efficient resource allocation.

Answer 13

competitive equilibrium

Question 14

is the equilibrium point where labor demand and supply meet at a certain wage and quantity of labor

Answer 14

Market- clearing

Question 15

The _____________ is below market clearing.

Answer 15

labor shortage

Question 16

What are the difference betweeen labor shortage and labor surplus?

Answer 16

The labor shortage is below market clearing, and the labor surplus is above the market clearing.

Question 16

The __________ refers to the value of a nation’s currency versus the currency of another country or economic zone

Answer 16

exchange rate

Question 16

the ____________ is above the market clearing.

Answer 16

labor surplus

Question 17

refers to a fall in the value of a currency in terms of its exchange rate versus other currencies

Answer 17

Currency depreciation

Question 18

refers to an increase in one currency’s value to another

Answer 18

Currency appreciation

Question 19

What are the Effects of peso depreciation against US dollars?

Answer 19

1. Peso depreciation (weaker currency) causes imported products and services more expensive.
2. Peso depreciation drives inflation since there is a price increase in imported products, including crude oil.
3. Exporters and OFWs (with their dependents) receive more pesos for every US dollar exchanged.
4. Foreign tourists think it is attractive to visit the country since their US dollars can now buy more pesos.

Question 20

refers to the ability of the household to pay the housing market price and available financing schemes.

Answer 20

Housing affordability

Question 21

is an intervention process that corresponds to setting the price ceiling on rent.

Answer 21

Rent control

Question 21

During the Asian Financial Crisis in the late_______, construction hit low levels in the country

Answer 21

1990

Question 22

The _____________________ of the government provides housing for informal settlers and other families who do not have enough income to buy or rent houses with rates in the prevailing market.

Answer 22

National Shelter Program

Question 23

the _______________, the government-owned and subsidized housing loan provider

Answer 23

Pag-IBIG Fund