Lesson 2 - Unemployment & Economic Policy

Question 1

________ are considered as the basic items essential for human survival. Food, water, and shelter are examples of needs.

Answer 1

Needs

Question 2

_______ are anything that we desire or would like to have.

Answer 2

Wants

Question 3

Wants can be for _______ purposes, or tools that make our lives easier.

Answer 3

entertainment

Question 4

_______ pertains to the quantity of goods or services that people are ready to buy at a given time, price, and place.

Answer 4

Demand

Question 5

______ pertains to the quantity of goods or services that firms are ready and willing to sell at a given time, price, and place.

Answer 5

Supply

Question 6

_________ measures the goods and services produced within the country’s geographical borders, by both Filipino residents and aliens in the country.

Answer 6

GDP

Question 7

_______ measures the goods and services produced by only Filipino residents, both domestically and abroad.

Answer 7

GNP

Question 8

3 BASIC ECONOMIC PROBLEMS

Answer 8

1. What to produce?
2. How to produce?
3. For whom to produce?

Question 9

The question is answerable by knowing the trend of the demand for goods and services of the people.

Answer 9

What to produce?

Question 10

The people of the society must determine who will do the production, with what amount of goods and services, and what production techniques they will use.

Answer 10

How to produce?

Question 11

The answer to this question is simple; we produce for the
people or the target market.

Answer 11

For whom to produce?

Question 12

FACTORS OF PRODUCTION

Answer 12

1. Land
2. Labor
3. Capital
4. Entrepreneur

Question 13

This broadly refers to all natural resources given by nature. These are all the things and powers that are given free to humankind by nature.

Answer 13

Land

Question 14

Compensation - Land

Answer 14

Rent

Question 15

Any form of human effort exerted in the production of goods and services. This includes the skills, abilities, and characteristics of laborers.

Answer 15

Labor

Question 16

Profession payment for labor is called

Answer 16

Wage/Salary

Question 17

Refers to the human-made goods used in the
production of other goods and services.

Answer 17

Capital

Question 18

The payment for the use of capital (money)

Answer 18

Investment or Interest

Question 19

The person who organizes, manages, and plans. The entrepreneur possesses managerial skills needed in building, operating, and
expanding a business.

Answer 19

Entrepreneur

Question 20

compensation or reward the entrepreneur received

Answer 20

Profit

Question 21

TYPES OF ECONOMIC SYSTEMS

Answer 21

*Traditional Economic System
*Mixed Economic System
*Market Economic System
*Command Economic System

Question 22

A _________ is a system that relies on customs, history, and time-honored beliefs.

Answer 22

traditional economy

Question 23

Tradition guides economic decisions such as ______ and _________.

Answer 23

production and distribution

Question 24

Societies with ______ _______ depend on agriculture, fishing, hunting, gathering, or some combination of them.

Answer 24

traditional economies

Question 25

They use barter instead of money.

Answer 25

TRADITIONAL ECONOMIC SYSTEM

Question 26

Market economic systems are based on the concept of _____ _____

Answer 26

free markets.

Question 27

In other words, there is very little government interference in this economic system

Answer 27

MARKET ECONOMIC SYSTEM

Question 28

There is no government intervention in a pure market economy (_____ _____).

Answer 28

“laissez-faire”

Question 29

However, no truly free ______ _______ exists in the world.

Answer 29

market economy

Question 30

there is a dominant centralized authority that controls a significant portion of the economic structure and government makes all economic decisions.

Answer 30

COMMAND ECONOMIC SYSTEM

Question 31

Also known as a _____ _____, the command economic system is common in communist societies since production decisions are the preserve of the government.

Answer 31

planned system

Question 32

a combination of different types of economic systems—cross between a market economy and command economy

Answer 32

MIXED ECONOMIC SYSTEM

Question 33

In the most common types of _____ ______, the market is more or less free of government ownership except for a few key areas like transportation or sensitive industries like defense and railroad.

Answer 33

mixed economies

Question 34

The _____ _____ refers to the alternating phases of economic growth and decline. Since the phases are recurring, they often occur in an identifiable pattern where one phase usually follows the other.

Answer 34

business cycle

Question 35

______ is the rate of increase in prices over a given period of time.

Answer 35

Inflation

Question 36

Inflation is typically a ___ measure, such as the overall increase in prices or the increase in the cost of living in a country

Answer 36

broad

Question 37

a term referring to individuals who are employable and actively seeking a job but are unable to find a job.

Answer 37

UNEMPLOYMENT

Question 38

The unemployment rate in July 2024 was estimated at _______

Answer 38

4.7 percent (2.38 million individuals)

Question 39

The unemployment rate in July 2023 was

Answer 39

4.9 percent (2.29 million individuals)

Question 40

The unemployment rate in April 2024 was

Answer 40

4.0 percent (2.04 million individuals)

Question 41

the biggest cause of unemployment that typically happens during a recession.

Answer 41

DEMAND DEFICIENT UNEMPLOYMENT

Question 42

When companies experience a reduction in the demand for their products or services, they respond by cutting back on their production, making it necessary to reduce their workforce within the organization.

Answer 42

DEMAND DEFICIENT UNEMPLOYMENT

Question 43

occurs from the inevitable time delays in finding new employment in a free market.

Answer 43

FRICTIONAL UNEMPLOYMENT

Question 44

It may also be called ‘search unemployment’ as it relates to the time taken to search for new employment. Refers to those workers who are in between jobs.

Answer 44

FRICTIONAL UNEMPLOYMENT

Question 45

Happens when the skills set of a worker does not match the skills demanded by the jobs available, or alternatively when workers are available but are unable to reach the geographical location of the jobs.

Answer 45

STRUCTURAL UNEMPLOYMENT

Question 46

It can also happen when there is a technological change in the organization, such as workflow automation that displaces the need for human labor.

Answer 46

STRUCTURAL UNEMPLOYMENT

Question 47

Voluntary unemployment happens when a worker decides to leave a job because it is no longer financially compelling. An example is a worker whose take-home pay is less than his or her cost of living.

Answer 47

VOLUNTARY UNEMPLOYMENT

Question 48

(Working-age population) Part of the Labor Force

Answer 48

Unemployed Employed part time Employed full time

Question 49

(Working-age population) Not the Labor Force

Answer 49

Not looking for other reasons Retired Permanently unable to work

Question 50

Economic policy covers a wide range of measures which governments use to manage their economy. These include:

Answer 50

monetary policy and fiscal policy.

Question 51

GOALS OF ECONOMIC POLICY

Answer 51

1. Economic Growth 2. Price Stability 3. Full Employment

Question 52

Means that the incomes of all consumers and firms (after accounting for inflation) are increasing over time.

Answer 52

Economic Growth

Question 53

The goal is to prevent increases in the general price level known as inflation, as well as decreases in the general price level known as deflation.

Answer 53

Price Stability

Question 54

The goal of full employment is that every member of the labor force who wants to work is able to find work.

Answer 54

Full Employment

Question 55

refers to central bank activities that are directed toward influencing the quantity of money and credit in an economy.

Answer 55

MONETARY POLICY

Question 56

GOALS OF MONETARY POLICY

Answer 56

1. Inflation 2. Exchange Rates 3. Unemployment

Question 57

Monetary policy is used to target a high level of inflation and reduce the level of money circulating in the economy.

Answer 57

Inflation

Question 58

The exchange rates between domestic and foreign currencies can be affected by monetary policy. With an increase in the money supply, the domestic currency becomes cheaper than its foreign exchange.

Answer 58

Exchange Rates

Question 59

Policy decreases unemployment as a higher money supply and attractive interest rates stimulate business activities and expansion of the job market.

Answer 59

Unemployment

Question 60

Refers to the government's decisions about taxation and spending.

Answer 60

FISCAL POLICY

Question 61

GOALS OF FISCAL POLICY

Answer 61

1. Taxation 2. Government Borrowing 3. Government Spending

Question 62

The most important generating measure of the government.

Answer 62

Taxation

Question 63

Borrowing play a central role in the fiscal policy in the government due to deficiency of its local and national tax collection.

Answer 63

Government Borrowing

Question 64

The spending system is the government fiscal arm producing, allocating, and distributing social goods and services.

Answer 64

Government Spending

Question 65

______ is the process of estimating revenue and expenses during a specific period of time.

Answer 65

Budgeting

Question 66

A ______ _______ is the budget of a country.

Answer 66

national budget

Question 67

The government gets money from ______ and _____, and spends it on things like national defense, infrastructure, grants for research, education, and the arts, and social programs such as Social Security and Medicare

Answer 67

taxes and fees

Question 68

money spent by the public sector on the acquisition of goods and provision of services such as education, healthcare, social protection, and defense

Answer 68

Government spending

Question 69

The Budget Cycle

Answer 69

Preparation Authorization Execution Accountability