I Flashcards
Economics is came from the Greek word?
Oikanomia or Oikonomus — which means “household management” (Leaño Jr., 2016) or “management of the household” (Viray Jr., & Avila-Bato, 2018)
It is the productivity and proper allocation of economic resources and the relationship between scarce factor of inputs and outputs of the goods and services.
Efficiency (The Three 3E’s of Economics). (The Three 3E’s of Economics)
It is the attainment of the goals & objectives.
Effectiveness (The Three 3E’s of Economics).
It refers to the justice and fairness.
Equity (The Three 3E’s of Economics).
Example of this is that “everyone must be given the help (for e.g) the goods to the affected families of the typhoon.”
Equity (The Three 3E’s of Economics). “EVERYONE”
It is the study or discipline that aims to explain the human behavior. It uses scientific method to formulate models based on the theories to help addressed arising issues that cause of human interaction. (Viray Jr., & Avila-Bato, 2018)
Economics as a SOCIAL SCIENCE.
According to Dinio & Villasis, 2017, Economics is a social science because it studies human behavior and ________ …
And how people make their decisions to satisfy their unlimited wants and needs by allocating limited resources.
Two branches of economics.
- Macroeconomics
- Microeconomics
Macroeconomics
It is the study of human behavior of the economy as a whole, or national economy itself.
- it also aggregates the flow of goods, resources & examines the causes of change in its overall flow.
Microeconomics
It is the study of human behavior wherein particular market. Such as market for computers, or unskilled labors.
Topics discussed in Macroeconomics:
- Gross National Product (GNP)
- Gross Domestic Product (GDP)
- National Income
- General Price Level
- It’s economic growth and development.
Topics discussed in Microeconomics:
- Principles and elasticity of demand & supply.
- Individuals decision-making.
- The firms costs and its outputs.
Four basic decision problems:
- Consumption
- Production
- Distribution
- Growth over time.
Three tools in economics:
- Logic
- Mathematics
- Statistics
It is a branch of science that deals with thinking and reasoning.
Logic
It is a branch of science that deals with the numbers and operations.
Mathematics
It is the branch of mathematics that engages with the analysis and interpretation of the data you’ve gathered.
Statistics
What should be provided in a logical tool?
Facts & evidences should/must be provided.
What is also called to mathematics tool in economics?
“quantifiable discipline”.
It explains the motion of opportunity costs. Decision making involves trade-offs and suggests that in society that there are no real ____..
NO FREE LUNCH
What is the meaning of acronym of ‘No Free Lunch’ ?
(TINSTAAFL) “There Is No Such Thing As A Free Lunch”.
Is an economic analysis that considers economic conditions “as they are”.
The objective and scientific explanation are used in the analysis in the economy.
Positive Economics
Is an economic analysis that judges the economic decisions “as these should be”.
Which also focuses to the policymaking that will allow the ideal situation to be achieved.
Normative Economics
A Greek term meaning “all other things held at constant or else all equal”.
Ceteris Paribus
Is the discipline dealing with the application of scientific knowledge to problems to develop practical solutions.
Applied Science
Is the study of economics relative to real-to-life situations by observing how theories work in practice.
Applied Economics
They determine the customers needs, wants, and demands—and also decide on how to distribute their resources to meet the customers demands/satisfaction.
Production (The four basic decision problems)
It is mostly addressed by the government. Wherein the appropriate allocation for all.
Distribution (The four basic decision problems)
Is the portion of the population who are 15 years old and over, that is willing to work.
Labor Supply (Labor Force)
The value of the gross domestic product (GDP) is determined by the _____…
“labor supply’s contribution to the productions of products and services”.
It refers to the total monetary or market value of all finished goods and services produced within a country’s boarders in a specific period. (Fernando, 2020)
Gross Domestic Product (GDP)
In year 2015, the Philippine per ‘output per capita’ is?
$2,635.04 which maintains the upward trend of OPC.
The real GDP divided by the population, refers to the how much the economy produces on average per resident.
Output Per Capita
Three types of employment:
- Underemployment
- Full Employment
- Unemployment
Are workers who highly skilled but working in a low paying job/s or company.
Underemployment (Three types of employment)
Occurs when the economy has relatively low unemployment.
Full Employment (Three types of employment)
Refers to the people who have no jobs and are looking for work.
Unemployment (Three types of employment)
Four types of ‘unemployment’ :
- Frictional Unemployment
- Structural Unemployment
- Seasonal Unemployment
- Cyclical Unemployment
Refers to the lowest allowed wage to be paid to workers under the legislation and government policies (Viray Jr., & Avila-Bato, 2018)
Minimum Wage
It is similar to product demand and follows the law of demand.
When wages increases, the numbers of laborers decreases as employers hire more employees when wages go down.
Labor Demand
Follows the law of supply—when wages increases, the labor Supply also increases, and vise versa.
Labor Supply
Refers to the value of nation’s currency versus the currency of other nations /economic zone.
Exchange rate
Refers to fall in value of a currency in terms of its exchange versus of the other currencies.
Currency depreciation
Refers to increase in value of one currency to the another currency.
Currency appreciation
The negative effects of exchange rate or currencies:
- Peso depreciation (weaker currency) causes imported (from international/other countries) products & services be more expensive.
- The government has higher debt servicing.
The positive effects of exchange rate / currencies:
- Exporters and OFW’s are receiving more pesos for every US dollar exchanged.
- Foreign tourists attract to visit the country.
Refers to an asset or item that it is purchased with the hope that it will generate income or appreciate in the future (Chen, 2021).
Investment
It also refers to the capital expenditure on physical assets such as plants, machinery, and equipment (PPE). (Viray Jr., & Avila-Bato, 2018)
Investment
Two classifications of investment:
- Fixed-Income Investments (FII’s)
- Variable-Income Investments (VII’s)
For investors that are risk averse which form of investment that generally sale investment options, providing fixed periodic sources over a certain period.
- it also has the government securities (treasury bonds, treasury bills & notes, and corporate bonds) also the accounts offered by the Banko Sentral ng Pilipinas (BSP)—that all guarantees having a lower-risk of losses.
Fixed Income Investments (FII’s)
There are no full guarantee for returns that are strongly influenced by the financial markets behavior and economic situations.
- suitable for risk-tolerant individuals as the invested money or resources may not be fully recovered.
Variable-Income Investments (VII’s)
Refers to the payment for the use of land and other natural or economic resources that is in fixed supply.
Rent / Rent on Land
Is the positive difference between the actual payment made to the other owner…
Economic Rent
Different Taxes:
- Individual Income Tax/es
- Corporate Income Tax/es
- Real Property Tax
Includes the ITR, if business is sole proprietorship or partnership. Which income is considered as “personal income”.
Individual Income Tax/es
A corporation is considered as a separate tax passing entity, passing it’s income taxes.
Corporate Income Tax/es
The tax burden of an average worker is up to ___?
35% = ₱8,000,000 (Total Income)
It is an organization or economic system where goods and services are exchanged for one another or for money. Every business requires some form of investment and enough customers to whom its output can be sold in a consistent basis to make a profit.
Business (II. The Role of Business in Social and Economic Development)
Business can be ____, ____, or ____.
Business can be PRIVATELY OWNED, NOT-FOR-PROFIT, OR STATE-OWNED.
(II. The Role of Business in Social and Economic Development)
The Four Basic Forms of Business Organizations
- Sole Proprietorship
- Partnership
- Cooperative
- Corporation
The advantage of this is that it is the easiest & least expensive form. The profits flow-through directly to the owners personal tax return. Lastly, the business is easy to dissolved if they want to.
Sole Proprietorship
Basic classification of business:
- Service Business
- Merchandising Business
- Manufacturing Business
Four subsets of service Business:
- Service Business
- Financial Business
- Transportation Business
- Utilities
Subset of Merchandising Business:
A. Retailers & Distributors
Subsets of manufacturing business:
A. Agriculture & Mining Business
B. Manufacturers
C. Real-Estate Business
Provides intangible products. Such as professional skills, expertise, advice, & etc…
Ex: schools, repair shops, hair salons, banks, accounting firm, & law firms.
Service Business
Typically charge for labors provided to government, consumers and to the other business.
Service Business (one of the subsets in a service business)
Includes banks & other companies that generate profits through investments.
Financial Business (one of the subsets in a service business).
Deliver goods and individuals to their destinations for a fee.
Transportation Business (one of the subsets in a service business).
Produce public services such as electricity or sewages treatment, usually under the government.
Utilities Business (one of the subsets in a service business)
It buys products at a wholesale price and sells the same at the retail price. “Buy and Sell” are known to this. It sells the product without changing its form.
Merchandising Business
Acts as a middleman and set goods produced by the manufacturers to the intended consumers.
Retailers and Distributors (one of the subsets in a service business).
They buys products with the intention of using them as materials in making a new product/s.
Manufacturing Business
Produce raw material, plants or minerals.
Agriculture and Mining Business (one of the subsets in a service business).
They produce products then sell.
Manufacturers (one of the subsets in a service business).
Sell, lent and develop properties. Including land, residential home, and other buildings.
Real-Estate Business (one of the subsets in a service business).
