Applied Economics – Grade 12

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Quarter 1 – Module 1: Introduction to Applied Economics
First Edition, 2020

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Development Team of the Module:
Development Team of the Module
Authors:
Author: Rhona Mae P. Labadan
RHONA MAE P. LABADAN
Evaluator: Zalvy Jean P. Galindo
Evaluator: ZALVY
Gwendylou JEAN P. GALINDO, GWENDYLOU
E. DableoE. DABLEO
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Co-Chairpersons: Dr. Victor G. De Gracia Jr., CESO V
Asst. Mala Epra B. Regional
Magna-ong Director
CES, CLMD
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CES,
Members : Dr. BienvenidoCLMD
U. Tagolimot, Jr.
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Ray Dr. Neil Improgo
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Regional
EPS-Designate- AP EPS-LR

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i
 12

Applied Economics
Quarter 1 – Module 1:
Introduction to Applied Economics

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We value your feedback and recommendations.

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ii
 Table of Contents

Copyright Page i
Module Title ii
Table of Contents iii

CONTENTS

Lesson 1: Basic Terms in Applied Economics

What’s In 4
What’s New 4
What Is It 5
What’s More 8
What I Have Learned 9
Additional Activities 10

Lesson 2: Basic Economic Problems of the Country

What’s In 11
What’s New 11
What Is It 12
What’s More 14
What I Have Learned 14
Additional Activities 15

Lesson 3: Applied Economics in Relation to the Philippine Economic

Problems
What’s In 17
What’s New 17
What Is It 18
What’s More 19
What I Have Learned 19
Additional Activities 20

Assessment 21
Answer Key 23
Reference 25

iii
 WHAT I NEED TO KNOW

Welcome to Module 1, your entry point to understanding Applied

Economics! This module will help you know more about our economy. It has
three lessons:
● LESSON 1- Basic terms in Applied Economics
● LESSON 2- Basic Economic Problems of the Country
● LESSON 3- Applied Economics in Relation to the Philippine Economic

Problems

The first lesson will introduce you to the basic terms used in applied
economics and the second and last part would inform you about the economic
problems present in our economy and how applied economics will help you
solve these.

I hope that this module will help you become an informed citizen by being
able to make better judgements on the resources you currently have. If you are
interested to learn more about how decisions should be made when you have
abundant or limited resources, this module will answer your queries.
Think of this first module as your starting point as you trace the way to
the full understanding of economics. Enjoy and let’s get your journey started!

After going through this module, you are expected to;

1. define basic terms in applied economics ABM_AE12-Ia-d-1;
2. identify the basic economic problems of the country ABM_AE12-Ia-d-2;
3. explain how applied economics can be used to solve economic problems
ABM_AE12-Ia-d-3;

To achieve the objectives of this module, do the following:

1. Read the texts slowly and carefully so that you can catch the main ideas.
2. To complete your learnings, do not proceed to the next page until you
are done reading the previous one.
3. Answer the pre and post-tests diligently.
4. Work on the exercises and enrichment activities.
5. Relate well and have fun!

1
 WHAT I KNOW
Before proceeding to the other parts of the module, test your knowledge
by trying to answer the questions that follow. Encircle the letter of your answer.
1. What do you call the condition in which our wants are greater than our
limited resources?
A. Economics C. Scarcity
A. Opportunity Cost D. Trade-off

2. What do you call things that you gave up when you make a choice?
A. Choice C. problem
B. opportunity cost D. Trade-off

3. What do you call the application of economic principles and theories to real-
world situations?
A. Applied Economics C. Macroeconomics
B. Economics D. Microeconomics

4. Which of the following is not a factor of production?

A. Capital C. Labor
B. Tax D. Land

5. What is supply?
A. It is a choice that you gave up C. It is the totality of our needs
B. It is the amount of goods for sale D. It refers to the economy

6. Which of the following classifications does not fall under underemployment?

A. Highly skilled but working in low paying jobs
B. Part-time workers who would prefer to be full time.
C. Without work and currently available for work
D. Workers who are highly skilled but working in low skill jobs

7. When does underemployment occur?

A. It is when a person does have work
B. It is when a person does not have work
C. It when a person does not work for a job that fits his/her skills.
D. It is when a person works for a job that fits his/her skills.

8. Which of the following works best for our country?

A. Decrease in the employment rate
B. Decrease in the underemployment rate
C. Increase in the underemployment rate
D. Increase in the unemployment rate

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9. What is most likely to happen when the population continues to rise?
A. Employment rate will go up
B. Poverty rate will decrease
C. Resources will become scarce
D. Unemployment rate will go down

10. According to Philippine Statistics Authority (PSA) what is the minimum age
that a Filipino must have in order to be classified as an unemployed person?
A. 13 years old
B. 14 years old
C. 15 years old
D. 18 years old

11. What kind of approach is used by economists to explain how the economy
works?
A. Collaborative C. positive
B. experimental D. scientific

12. What are you experiencing when your wants are greater than your
resources?
A. Poverty C. trade-off
B. Scarcity D. unemployment

13. What is the reason why we are studying economics?

A. Poverty C. trade-off
B. Scarcity D. unemployment

14. What type of analysis are economists concerned with in order to become
objective?
A. careful C. normative
B. negative D. positive

15. Which major characteristic of economists enable them to make sound

decisions in solving economic problems?
A. objective C. subjective
B. prompt D. trustworthy

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 LESSON 1: Basic Terms in Applied Economics
Learning Competency: Define basic terms in applied economics. ABM_AE12-
Ia-d-1

WHAT’S IN

Have you tried to budget your money in order to buy what you want to
eat or consume in your daily living? Have you tried to run out of water while you
were taking a bath? Have you tried to limit the number of kilos of rice that you
will buy for your daily consumption? If you have answered yes to at least one
of these questions, then you must be facing the trauma of not being able to
have enough of what you wanted.
In this lesson, you will be introduced to the most basic terms used in
Applied Economics and their corresponding definitions. These words will surely
guide you in understanding the real meaning of Applied Economics.

WHAT’S NEW

Directions: Below is a list of the basic terms used in Applied

Economics. Encircle the words as soon as you found them inside the puzzle.
Scarcity Economics Trade-offs Opportunity Cost
Microeconomics Macroeconomics Supply Demand
Land Labor Capital Aggregate
Needs Wants

I H A V E A D R E T S O C Y T I N U T R O P P O A D
S M A S O N G T O S I N G T O H E L P M E C A L L N
C R E Y A L I T Y I F Y O U S E E T H E W O W N D A
A E R L O F A S C I M O N O C E O R C I M F A A I L
R R Y P T A I L Y O S U C A N E T A K E T H N E F U
C T U P D R E E V F E N I S F Y T O U C A N T T C I
I B E U L E E I F V E I N D A N G A E L S O S M A E
T T H S R I M O N G G O O E D I N E G V E R Y T P H
Y I N O G I E A S E E I B E E L I E V E E I N A I N
G E B L W D H E N N I K N N O W T H E T R I M E T F
O A R M A E H A S D C H A N G E D A C R O G S S A T
G T H R E S M A C R O E C O N O M I C S T E G E L T
I H T A V E A E C O N O M I C S D R E A M W I A S H

4
 WHAT IS IT

What is Scarcity?

Life would be easier if we could have whatever we wanted, whenever

we wanted it. Unfortunately, life doesn’t work that way. There are times when
we feel like buying all the things we want while window shopping but we just
don’t have enough money. At times, when we are craving for some food, the
store just runs out of stock. There are times when we really wanted to take a
bath but there is no single drop of water coming out of the faucet, or we wanted
to light up a candle but we ran out of matchsticks. You see, this is scarcity, and
it is everywhere. Scarcity is the condition in which our needs and wants are
greater than our limited resources.

Needs and wants differ from person to person. The easiest way to
describe needs is that these are the things that we can’t live without. Examples
of needs are air, water, food and shelter. On the other hand, wants are those
that we can live without. Examples of wants are jewelries and luxuries.

Why is scarcity linked to Economics?

Scarcity is the reason why people have to study and practice economics.
Economics studies how people distribute or divide their limited resources in
order to satisfy their unlimited wants. Or simply, it is the study of how individuals
and societies deal with scarcity.

5
 For instance, if after your examination you plan to eat a heavy lunch with
your limited allowance which is 100 pesos, you will have to budget it and decide
about which food you will buy to satisfy your hunger. Since we are unable to
have everything we desire, we must make choices on how we will use our
limited resources.

What are Trade-offs?

When making choices, there are things that we need to give up. Trade-
offs consist of all the options that we give up when we make a choice.
Following the previous example, you planned to spend your limited
allowance to buy 2 pieces of siopao and softdrinks to satisfy your hunger. Your
other option is to pay for a heavy value meal at 120 pesos or buy your favorite
meal combo at 115 pesos. You gave these options up since you can only afford
to pay for the siopao and drinks. The choices that you’ve given up are your
trade-offs.

What is an Opportunity Cost?

Among all your trade-offs, the most desirable alternative that you gave
up is called the opportunity cost. In the previous example, the most desirable
option is to buy your favorite meal combo at 115 pesos. You cannot afford it
since you only have 100 pesos so you gave it up.

No matter what choice you make, there is an opportunity cost, or next-

best alternative, that must be sacrificed. Opportunity cost is the highest-
valued alternative that must be sacrificed in order to get something else. The
key to making the best possible decision is to minimize your opportunity cost
by selecting the option that gives you the largest benefit.

What are the Branches of Economics?

Microeconomics is a branch of economics that is concerned with the

decision-making done by smaller economic units such as individuals or
consumers, firms and industries. Macroeconomics on the other hand is the
study of the large economy as a whole or the aggregate economy.

What is Supply and Demand?

To better understand Economics, we also need to know about supply

and demand. Supply refers to the total number of goods or services available
for sale. These goods or services are produced by making use of the factors of
production consisting of land, labor and capital. Land refers to all natural
resources or any raw materials coming from the ground that is used to produce
supply. Labor on the other hand is the work done by people or human
resources. Capital does not only mean money as this can be in the form of

6
man-made tools or objects that may be used to produce supplies. Demand on
the other hand refers to the aggregate or the totality of the needs and wants of
the customers. Balancing these two is one of the goal of Economics so that
scarcity is eliminated.

What is Applied Economics?

Applied Economics is the application of the principles of supply,

demand, trade-offs, opportunity-costs, and other economic theories to solve
real-world problems. It may be practiced in the microeconomic or
macroeconomic level. Applying economic theories in our lives means trying to
address actual economic issues and be able to do something about it.

7
 WHAT’’S MORE

Directions: Define the basic terms in Economics as indicated below by

completing the concept map. Widen your imagination and think of words or
phrases which may define these terms:

Supply Demand Needs Wants

Trade-offs Applied Economics

Opportunity Costs Economics

8
 WHAT I HAVE LEARNED

Directions: On Column A are the basic terms used in Economics.

Define each term based on how you understand it from the previous texts.
Place your definitions under Column B.

Column A Column B
1. Aggregate
2. Capital
3. Demand
4. Economics
5. Labor
6. Land
7. Macroeconomics
8. Microeconomics
9. Needs
10. Opportunity Costs
11. Scarcity
12. Supply
13. Trade-offs
14. Wants

WHAT I CAN DO

Directions: Internalize the basic terms in Applied Economics introduced to you

a while ago. Grab a newspaper. Turn to the business section or page. List down
at least 5 terms that you think would relate to Applied Economics and then
briefly define these terms that you have listed.
1. ______________________ - __________________________________
2. ______________________ - __________________________________
3. ______________________ - __________________________________
4. ______________________ - __________________________________
5. ______________________ - __________________________________

9
 ADDITIONAL ACTIVITIES

Situation: Imagine that you were on a class field trip for three days. Your mom
sent you a pocket money of Php 1,500.00. You have already planned to use
this to buy an acoustic guitar so you could practice playing it when you got
home. While strolling around the mall, you found a beautiful necklace which
would certainly look good on your mom and it costs Php 500. You know that if
you bought the necklace, your mom would be glad, however, buying it would
make you unable to buy your beloved guitar. Which one would you buy? Why?
Answer:
______________________________________________________________

What basic economic term(s) can we extract from the situation above? List
them down here:

Congratulations for completing Lesson 1!

10
 Welcome to Lesson 2!

LESSON 2: Basic Economic Problems of the Country

Learning Competency: Identify the basic economic problems of the country.

ABM_AE12-Ia-d-2

WHAT’’S IN

In the previous lesson, you were introduced to the basic terms used in
Applied Economics. These terms will help you to better understand applied
economics and the current situations faced by our country.
In this lesson you will be identifying the basic economic problems of the
country which are all linked to scarcity. Take time to read and feel the different
types of situations you will be immersed in.

WHAT’’S NEW

Directions: Concentrate on reading the following situation. Immerse yourself

into it. Try to feel it and answer the questions that follow.
At the age of 14, you were forced to leave school as you can no longer
pay for the school fees or afford to buy food whenever you’re in school.
Supposedly, you will be entering senior high school. You are the eldest son and
you have 5 other siblings. As a product of a broken family, with your father
marrying into another woman, and your mother marrying into another man, you
were left with the responsibility of taking care of your younger siblings and your
family as a whole. In order to survive, you did many part-time jobs. One day,
you felt that the money you’re earning is no longer enough to support your
siblings and so, you decided to find a regular job. While looking for a job, you
got frustrated because nobody would want to hire you as you are still very young
and lack qualifications. Identify the problems that you experienced in this
situation. List these below.
Answer:
______________________________________________________________
______________________________________________________________
______________________________________________________________
______________________________________________________________

11
 WHAT IS IT

All societies are faced with questions about what goods and services
should be produced, how these should be produced and who consumes these.
Knowing the answers to these questions would lead us to identify possible
problems and solutions to existing economic problems.

What are the Basic Economic Problems in the country?

Philippines as a growing country is not exempted from experiencing

economic problems. Under the Duterte administration, the country has
significantly improved its economic marks, however, problems still exist. Take
a look at the following scenario and examine or identify the economic problem
present in it.
Situation #1: You are a fresh graduate at a prestigious university. You
graduated as summa cum laude and received numerous recognition awards.
You took up an education course in order to become a teacher, however, after
graduating, you could not find available jobs within the province. What
economic problem is present and is affecting you here?
1. In this situation, you are affected by the so-called unemployment problem,
which is still among the basic problems of the country. According to PSA
(Philippine Statistics Authority, the unemployed include all persons who are
15 years and over as of their last birthday and are reported as: (1) without
work and currently available for work and seeking work; or (2) without work
and currently available for work but not seeking work for the following
reasons: Tired/believed no work is available; awaiting results of previous job
application; temporary illness/disability; bad weather and; waiting for
rehire/job recall.
According to the records of PSA (Philippine Statistics Authority), the
unemployment rate in the year 2018 is at 5.3% and this went down a little bit in
the year 2019 becoming 5.2%. These figures show that there is still a huge
number of Filipinos who are not working. Not having a job means not having a
source of income to provide for our personal needs and wants, not being able
to being prone to scarcity issues. Unemployment has been an issue in the
country for many years which is why the government is seeking ways to
address the problem.
Aside from unemployment, another basic economic problem is faced by
Filipinos. Discover it by reading and immersing yourself in the situation below.
Situation #2: You are a newly-registered nurse. You wanted to immediately
find a job to save enough money for your sick father’s hospitalization. There is
no other available job opportunity in the area except for an immediate hiring for
customer service representatives. You got the job and you’re now a contact
center agent. What economic problem is present and is affecting you here?

12
2. In this situation, you are affected by the so-called underemployment
problem, which is also among the basic problems of the country.
Accordingly, labor that falls under the underemployment classification
includes those workers who are highly skilled but working in low paying jobs,
workers who are highly skilled but working in low skill jobs and part-time
workers who would prefer to be full time.
According to the records of PSA (Philippine Statistics Authority), the
underemployment rate in the year 2018 is at 18.0% and this went down a little
bit in the year 2019 becoming 15.6%. There is a decrease in the percentage
rate which means the Philippines is getting better, however it remains to be an
economic problem. Having a job that doesn’t match your skills still boils down
to being prone to scarcity issues.
Situation #3: Suppose that you, being the eldest of ten siblings were not able
to finish your studies. You were forced to stop going to school at the age of 13
and find a job at an early age in order to support your siblings. What economic
problem can be seen here?
3. In this situation, you are affected by the number one problem of the
country which is poverty.
The booming population growth in the Philippines is another basic
economic problem that can be connected to the issue of scarcity. When
population becomes too big, economic resources may no longer be enough to
support the increasing number of people. Food, water, shelter, medicine and
other resources wouldn’t be enough to satisfy every people’s needs and wants.
On a 2015 report by the Philippine Statistics Authority (PSA), five (5) out
of nine (9) basic sectors of the economy are considered very poor. The farmers
came first, followed by fishermen, children, self-employed and unpaid family
workers, and women. You see, those who do hands-on jobs usually get lower
incomes. This is even the reason why Filipinos tend to go abroad as they get
better pays outside the country.
All of the country’s basic economic problems vary with times and
circumstances. Unemployment, underemployment, poverty and population
increase are just few of the basic economic problems faced by our country.
These problems are linked to scarcity. These problems would not have
occurred if the resources or supplies are equally distributed to suit to the needs
and wants of people. It is now a challenge for you to observe and identify other
economic problems so you may be able to think about it and reflect on how you
could help in solving it.

13
 WHAT’’S MORE

Situation 1: Imagine that you were born and raised in a wealthy family. You
can buy what you want, go to places you love and enjoy the things that money
can buy. You wanted to become a doctor so you pursued your education and
graduated with honors. The only problem is that, since you are the heir of the
CEO of a large business company, you cannot practice your profession as a
doctor. Instead, you are forced to succeed the business of your family. Thus,
you are now working as a businessman. Identify the economic problem that can
be seen from this scenario. Briefly explain your answer.
Answer:
______________________________________________________________
______________________________________________________________
______________________________________________________________
______________________________________________________________

WHAT I HAVE LEARNED

Directions: Try to summarize what you have learned by completing the following
statements:
1. All societies are faced with questions about ________ goods and services
should be produced, __________ these should be produced and
_________ consumes these.

2. According to PSA (Philippine Statistics Authority, the unemployed include

all persons who are ______ years and over as of their last birthday and are
reported as: (1) without work and currently available for work and seeking
work; or (2) without work and currently available for work but not seeking
work for the following reason.

3. _______________________ classification includes those workers who are

highly skilled but working in low paying jobs, workers who are highly skilled
but working in low skill jobs and part-time workers who would prefer to be
full time.

4. On a 2015 report by the Philippine Statistics Authority (PSA), five (5) out of
nine (9) basic sectors of the economy are considered very poor. The
_________ came first, followed by _______________, children, self-
employed and unpaid family workers, and women.

14
5. Unemployment, underemployment, poverty and population increase are just
few of the basic economic problems faced by our country. These problems
are linked to ________________.

ADDITIONAL ACTIVITIES

Directions: Cut out at least 3 pictures from newspapers or any unused

catalogues which for you represents a particular economic problem. Paste
it inside the boxes below and write a short caption identifying the economic
problem present in it.

15
Congratulations for completing Lesson 2!

16
 Welcome to Lesson 3!

LESSON 3: Applied Economics in Relation to the Philippine Economic

Problems

Learning Competency: Explain how applied economics can be used to solve

economic problems, ABM_AE12-Ia-d-3

WHAT’’S IN

You have learned from the first lesson of this module that applied
economics is the application of economic principles and theories to real-world
situations in order to predict future outcomes. Therefore, it makes sense that if
you will apply the economic theories that you will learn in your personal life and
the society you’re at, you may actually be able to address actual economic
issues and do something about it.

WHAT’S NEW

Let’s go back to one of the situations in lesson 2. You are a fresh

graduate at a prestigious university. You graduated as summa cum laude and
received numerous recognition awards. You took up an education course in
order to become a teacher, however, after graduating, you could not find
available jobs within the province. You have known that you were affected by
the unemployment problem here. What do you think should be done to address
this problem which is just one of the many cases in the country? Briefly explain
your answer.
Answer:
______________________________________________________________
______________________________________________________________
______________________________________________________________
______________________________________________________________

______________________________________________________________
______________________________________________________________

17
 WHAT IS IT

How economists face economic problems

Just like a scientist who needs a science laboratory, as an economist,

your laboratory is the world around you, from the economy as a whole to the
decisions made by firms and individuals. In order to explain why the economy
works in a certain way you need to gather historical data or even wait for events
to take place to better understand the economy.
The scientific approach is necessary in solving economic problems. It
consists of steps such as observing the economic problem that interests you;
proposing an explanation about why the problem occurred; gathering data to
prove the truthfulness of the causes of the problem and then recommending
the best possible solution based on the verified causes.
One major characteristic of economists that enable them to make sound
decisions in solving economic problems is by being objective. This means that
they try to avoid letting personal beliefs and values influence the outcome of
their analysis
To be as objective as possible, economists make use of positive
analysis. A positive statement can be tested and validated. For instance, the
statement “the joblessness rate is 5.0%” is an affirmative statement because it
can be tested by collecting data.
In contrast, a normative statement cannot be corroborated. For
instance, the statement “an unemployed worker should receive financial
assistance in order to survive” is a matter of opinion. Financial assistance may
be beneficial to the unemployed but it might turn out as a way of pampering
them which would make them want to stay lazy and unemployed. Neither
opinion is correct or not because of opposing standpoints based on values,
traditions and beliefs.
Economists are concerned with positive analysis. In contrast, normative
statements are applied by policymakers, voters, and philosophers. There is no
exact way to solve economic problems, if there was, they could not have existed.
However, Applied Economics employs positive analysis and the scientific
method which is the best way to solve economic problems.
For instance, if the joblessness rate rises, economists try to apprehend
the circumstances that produced the situation. Economics, if done properly, is
confined to positive analysis.

18
 Going back to the previous activity that you’ve answered where you have
been affected by unemployment since you cannot find available jobs, the most
appropriate thing an economist must do is to apply positive analysis.
Unemployment happens due to scarcity of jobs which means the number of
prospect workers or job applicants do not match the number of jobs available.
Thus, these numbers must be looked into. Data should be gathered and
validated before economists could suggest or recommend something that will
equalize the numbers. This would need government intervention at the end
since they have control over the economy. This is how applied economics
works.

WHAT’S MORE

Let’s go back to another situation in Lesson 2 where you have experienced

underemployment. We assumed that you were a nurse by profession but you
were working as a contact center agent. Try to explain how applied economics
can be used to solve this problem.
______________________________________________________________
______________________________________________________________
______________________________________________________________
______________________________________________________________

WHAT I HAVE LEARNED

 Applied Economics makes use of the scientific approach to explain how

the economy and the world works.

 Economists try to avoid letting personal beliefs and values influence the
outcome of their analysis by being objective.

 To be as objective as possible, economists make use of positive

analysis which can be believed of as a depiction of “what is and can be
tested.

19
 ADDITIONAL ACTIVITIES

Using your own idea and understanding of the lessons contained in this first
module, explain the importance of studying Applied Economics.
Answer:
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________

20
 ASSESSMENT

Before proceeding to the next module, test your knowledge by answering

the questions that follow. Encircle the letter of your answer.

1. What do you call the condition in which our wants are greater than our
limited resources?
A. Economics C. Scarcity
B. Opportunity Cost D. Trade-off

2. What do you call things that you gave up when you make a choice?
A. Choice C. problem
B. opportunity cost D. Trade-off

3. What do you call the application of economic principles and theories to real-
world situations?
A. Applied Economics C. Macroeconomics
B. Economics D. Microeconomics

4. Which of the following is not a factor of production?

A. Capital C. Labor
B. Tax D. Land

5. What is supply?
A. It is a choice that you gave up C. It is the totality of our needs
B. It is the amount of goods for sale D. It refers to the economy

6. Which of the following classifications does not fall under underemployment?

A. Highly skilled but working in low paying jobs
B. Part-time workers who would prefer to be full time.
C. Without work and currently available for work
D. Workers who are highly skilled but working in low skill jobs

7. When does underemployment occur?

A. It is when a person does have work
B. It is when a person does not have work
C. It when a person does not work for a job that fits his/her skills.
D. It is when a person works for a job that fits his/her skills.

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8. Which of the following works best for our country?
A. Decrease in the employment rate
B. Decrease in the underemployment rate
C. Increase in the underemployment rate
D. Increase in the unemployment rate

9. What is most likely to happen when the population continues to rise?

A. Employment rate will go up
B. Poverty rate will decrease
C. Resources will become scarce
D. Unemployment rate will go down

10. According to Philippine Statistics Authority (PSA) what is the minimum age
that a Filipino must have in order to be classified as an unemployed person?
A. 13 years old
B. 14 years old
C. 15 years old
D. 18 years old

11. What kind of approach is used by economists to explain how the economy
works?
A. Collaborative C. positive
B. experimental D. scientific

12. What are you experiencing when your wants are greater than your
resources?
A. Poverty C. trade-off
B. Scarcity D. unemployment

13. What is the reason why we are studying economics?

A. Poverty C. trade-off
B. Scarcity D. unemployment

14. What type of analysis are economists concerned with in order to become
objective?
A. careful C. normative
B. negative D. positive

15. Which major characteristic of economists enable them to make sound

decisions in solving economic problems?
A. objective C. subjective
B. prompt D. trustworthy

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I H A V E A D R E T S O C Y T I N U T R O P P O A D Lesson 1: WHAT’S NEW
S M A S O N G T O S I N G T O H E L P M E C A L L N
C R E Y A L I T Y I F Y O U S E E T H E WO W N D A
A E R L O F A S C I M O N O C E O R C I M F A A I L
R R Y P T A I L Y O S U C A N E T A K E T H N E F U
C T U P D R E E V F E N I S F Y T O U C A N T T C I
I B E U L E E I F V E I N D A N G A E L S O S M A E
T T H S R I M O N G G O O E D I N E G V E R Y T P H
Y I N O G I E A S E E I B E E L I E V E E I N A I N
G E B L WD H E N N I K N N O WT H E T R I M E T F
O A R M A E H A S D C H A N G E D A C R O G S S A T
G T H R E S M A C R O E C O N O M I C S T E G E L T
I H T A V E A E C O N O M I C S D R E A M W I A S H
1. C. Scarcity
2. D. trade-off
3. A. Applied Economics
4. B. Tax
5. B. it is the amount of goods for sale
6. C. Without work and currently available for work
7. C. it is when a person does not work for a job that fits his/her skills
8. B. Decrease in underemployment rate
9. C. Resources will become scarce
10. C. 15 years old
11. D. scientific
12. B. Scarcity
13. B. Scarcity
14. D. Positive
15. A. Objective
WHAT I KNOW/ASSESSMENT
ANSWER KEY
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Lesson 2: WHAT I HAVE LEARNED
1. What, how, who
2. 15
3. Underemployment
4. Farmers, fishermen
5. scarcity
REFERENCES

Book
Rosemary P. Dinio, PhD and George A. Villasis. 2017. Applied Economics.
Manila: Rex Book Store, Inc.

Electronic

2017. Philippine Statistics Authority. June 30. Accessed January 27, 2020.
https://psa.gov.ph/content/employment-rate-january-2019-estimated-
948-percent
2017. Philippine Statistics Authority. June 30. Accessed January 27, 2020.
https://psa.gov.ph/poverty-press-releases/nid/120251.

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