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economics
people and choices
oikonomia
household management
economics
social sciencethat deals 3wwith optimum allocation of scarce or limited resources to satisfy he unlimited wants
social science
utilizesĀ the scientific method of inquiry from identifying the problem, propose alternativeĀ answers or hyphotheses, testing the tentative answers to the question, gathering of data, and answering the question through conclusion.
allocation
alternative solution to scarcity which is the systematic distribution and maximum useĀ of economic resources according to its use.
resources
it is linked with theĀ previous definition of economics at the process of wealth creation and wealth utilization
resources
Included are natural resources from marine resources, forest resources, mineral resources, human resources, physical resources.
Human wants
can be described asĀ differentiated or expanded humanĀ needs.Ā Ā
scarcity
Limitation of resources to answer the expanding human wantS
scarcity
a state where limitedĀ resources are not enough to satisfyĀ the wants of the people in a place at the time when it is actually needed
economic resources
There is economic problem when wants of people are not met. It occurs when there is scarcity of
land labor capital technology
Economic Resources or Factors of Production
allocation
Alternative solution to solve problem in Scarcity.Ā This is the systematic distribution and maximum use of economic resources according to its needs.
traditional economy
decisions are based on traditions and practices upheld over the years and passed on from generation to generation.
command economy
the authoritative system wherein decision ā making is centralized in the government or a planning committee. Decision are imposed on theĀ people who do not have a say in what goods are to be produced.
market economy
this is the most democratic form of economic system. Decisions are made on what goods and services to produce.
physiological needs
the basic needs for survival.
safety neeeds
people need to be secure once they satisfy their needs.
personal security
efers to living in a community that is freeĀ from crime and violence
financial security
characterized by job security and financial freedom
health security
pertains to being free from sickness and having a healthy body
assurance
in the form of health/life insurance that providesĀ security
social needs
love and belonging needs.
esteem needs
people need to be respectedĀ and confident about themselves.Ā The need for accepted by others is important to people.
self actualization
refers to the need for achievement after working hard for something.
engle law
states that as income increases, the greater percentage will spent on non-food items or luxuries.
macroeconomics
division of economics concerned with the overall performance of the entire economy.
economic changge
the shift in the structure ofĀ economic system.
microeconomics
concerned with the behaviour of individualĀ entities such as the consumer, the producers, and the resource owner.Ā Ā
market demand
demand for a product in the market,Ā it is a product or service measured by its consumption, need and usage rate by the consumer market.
elasticity of demand
It isĀ the demand for a commodity that moves in the contrary direction of its price.Ā
product price
the cost of production, shortage or excess of the product in the market, import/export duty, etc
market
any set of contact between the buyers and the sellers need not be a definite geographic area.
price
the monetary value per physical unit.
labor theory
the basis was the time spentĀ in producing and its difficulty to produce. When it takes time to produce a certain product in the past, the higher its valueĀ in exchangingĀ the commodity.
subjectivist theory
based on individual subject evaluations of the use value of economic goods.
utility theory
the basis in pricing the commodity is the degree of satisfaction derived as the buyer uses the product.
marginal utility
Ā value anĀ individual enjoys by purchasing one more item but declines the more you buy.
law of marginal utility
states that as more and more products are consumed, the total satisfaction or total utility increasesĀ at a diminishing rate and decreases after reaching the satisfaction point.
demand
Ā refersĀ to the willingness and ability of the buyers to purchase a specific good at differentĀ possible prices over a definite place and time.
law of demand
states that the higher the price the lesser the quantity demanded, and the lower the price, the greater the quantity demanded.
demand schedule
a schedule of various quantitiesĀ of a given product that the buyers areĀ willingĀ and able to buy at different possible prices over a given place and time.
demand curve
a graph that shows the relationship between the price of a good or service and the quantity demanded within a specified time frame
demand function
mathematical function that describes the relationship between price and quantity demanded. It is used to determine how much of a good or serviceĀ consumers are willing to purchase at a given price.
normal goods
good that experiences an increase in demand due to an increase in a consumer's income.
inferior goods
a good whose demand decreases with an increase in the consumerās income or expansion of theĀ economy.su
substitute goods
a goodĀ that meet the same requirements or fulfill the same needs as another good.
complimentary goods
aĀ good consumed or used together.
supply
the willingness and ability of the sellers to offer for sale various quantities of a given product in a given placed and time while other factors are held constant.
law of supply
Ā The higher the price, the greater the quantity supplied, the lower the price, the lesser the quantity supplied.
equilibrium
a state of balance when demand is equal to supply.Ā The equality means that the quantityĀ that sellers are willing to sell is also the quantity that the buyers are willing to buyĀ for a price.Ā
ceteris paribus
An increase in price(P ) causes an increase in quantity (Q ) conversely, a decrease in price (QĀ )causes a decrease (Q ) also in quantity supplied.
equilibrium
demand is equal to supply
disequilibrium
quantity demand is not equal to quantity supply
surplus
demand is less than supply
shortage
demand is greater than supply
price floor
impose a minimum price on certain goods and services. They are usually put in place to protect vulnerable suppliers.
price ceiling
a limit on the price of a good or service imposed by the government to protect consumers.
price elasticity
measures the degree of responsiveness of the quantity demanded of the buyers or quantity supplied of the sellers to price changes.
elasticity demand
measures the degree of responsiveness of the quantity demanded of the buyersĀ to price changes.
elasticity demand
measures the degree of responsiveness of the quantity supplied of the sellersĀ to price changes
elastic demand
%Ā Ā QdĀ > % Ā Ā P
Ā Ā /e/ > 1Ā
elastc supply
Ā %Ā Ā QsĀ > % Ā Ā P
Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā /e/ > 1
inelastic demand
Ā % Ā QdĀ <Ā % Ā Ā P
Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā Ā /e/ < 1Ā Ā Ā Ā
inelastic supply
% Ā QsĀ <Ā %Ā Ā Ā P
Ā Ā Ā /e/ < 1Ā Ā Ā Ā
unitary
Ā %Ā Ā QdĀ =Ā %Ā Ā Ā P
Ā Ā Ā /e/ = 1Ā
perfectly elastic
%Ā Ā QdĀ =Ā %Ā Ā Ā P
Ā Ā Ā /e/ =Ā ā
perfectly inelastic
Ā /e/ = 0Ā
elasticity
degree to which individuals, consumers, and producers change their demand or the amount supplied in response to price or income changes.
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