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    Nature and Scope of Economics (Autosaved)

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    Rosemarie Calaus
    Applied Economics Module 1

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    Nature and Scope of Economics (Autosaved)

    Uploaded by

    Rosemarie Calaus
    6 views22 pages
    Applied Economics Module 1

    Original Title

    1. Nature and Scope of Economics [Autosaved]

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    Applied Economics Module 1

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    6 views22 pages

    Nature and Scope of Economics (Autosaved)

    Uploaded by

    Rosemarie Calaus
    Applied Economics Module 1

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 22

    Nature and Scope of

    Economics
    What is
    Economics?
    Oikos - household

    nomos - management
    What is
    Economics?
    The branch of knowledge
    concerned with the
    production, consumption,
    and transfer of wealth.
    What is
    Economics?
    It is the use or allocation
    of
    scarce resources to meet man’s
    unlimited needs and wants.
    Scarcity
    It is the insufficient or
    inadequacy of economic
    resources and as a result,
    we have to decide and
    choose.
    Major Divisions of
    Economics
    Microeconomics

    It focuses on the behavior of


    individual economic units and
    the functioning of markets. Its
    perspective focuses on parts of
    the economy: individuals, firms,
    and industries.
    Macroeconomics
    Its perspective looks at the
    economy as a whole, focusing on
    goals like production, the standard
    of living, unemployment and
    inflation. Macroeconomics has two
    types of policies for pursuing these
    goals: monetary policy and fiscal
    policy.
    Microeconomics
    • Studiesvs.Macroeconomics
    individual Income • Studies national Income
    • Analyzes demand and • Analyzes total employment
    Supply of labor in the economy
    • Deals with households and • Deals with aggregate
    firms decisions decisions
    • Studies individual prices • Studies overall price level
    • Analyzes demand and • Analyzes aggregate demand
    supply of goods and aggregate supply
    BASIC TERMS TO UNDERSTAND
    ECONOMICS
    TANGIBLE GOODS – material goods
    or commodities.

    INTANGIBLE GOODS – when they


    are in the form of services. Those
    rendered by doctors, engineers,
    doctors and other professionals
    Goods may also be classified according to use…

    CONSUMERS GOODS – goods for the ultimate


    consumption of the consumers.
    Ex.: toothpaste
    bath soap
    shampoo
    Goods may also be classified according to use…

    CAPITAL GOODS or INDUSTRIAL GOODS -


    used in the production of other goods and
    services.
    Ex.: buildings
    machinery
    equipment
    Goods may also be classified according to use…

    ESSENTIAL GOODS - used to satisfy the basic


    needs of man.
    Ex.: foods and medicine.
    Goods may also be classified according to use…

    LUXURY GOODS – goods man may do


    without, but may give comfort and
    satisfaction.
    Ex.: perfume
    cakes
    chocolates expensive cars.
    Goods may also be classified according to use…
    ECONOMIC GOODS – goods which are useful
    and scarce; with value attached to them and a
    price has to be paid for their use. If a good so
    abundant and it can satisfy everyone’s needs
    without anybody paying for it, then, that good is
    free
    Ex.: Health Services, Farms, Clothing, Education
    CONSUMER INDUSTRIAL ESSENTIAL LUXURY ECONOMIC
    GOODS GOODS GOODS GOODS GOODS
    Direction: Pick all the goods and classify
    them accordingly. Your mother went to the
    market to shop goods for the family. She
    purchased the following goods.
    - Canned goods - Bread - coffee maker
    - sacks of rice - meat
    - vegetables - toothpaste
    -bath soaps - perfumes
    -wrist watch - aircon
    CONSUMER INDUSTRIAL ESSENTIAL LUXURY ECONOMIC
    GOODS GOODS GOODS GOODS GOODS
    Canned
    bath soaps coffee maker wrist watch aircon
    goods
    toothpaste perfumes
    vegetables

    Bread

    meat

    sacks of rice
    ECONOM
    ICS because
    APPLIED SCIENCE it
    uses the scientific method in its
    explanations, which consists of
    observing reality and
    presenting questions and
    problems to
    arrive at the formulation of
    ECONOMICS as a social
    science…
    SOCIAL SCIENCE concerned
    with the explanation and
    prediction of observed
    phenomena in the society.

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