Principles of Economics with Agrarian Reform and Taxation

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Principles of Economics with Agrarian Reform and
Taxation

• Mrs. Marfel M. Flores
• Online instructor
• marfelmflores_at_ama.edu.ph

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Previously ...

• Orientation on E-Learning
• Background of the course

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Today ...

• Introduction
• Definition/ Division /Branches Of Economics
• Economic Resources
• Human Needs and Wants

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Objectives

• Understand the fundamental concepts in economics
• Analyze the basic economic problems

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What is economics?

• Economics is the social science that studies the
  production, distribution, and consumption of
  goods and services.
• It is also the study of how the forces of supply
  and demand allocate scarce resources.

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• The term economics comes from the Ancient Greek
  word oikonomia that means "management of the
  household.
• Its root word is from (oikos, "house") (nomos,
  "custom" or "law"), hence "rules of the
  house(hold)"

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• " Economics is the study of mankind in the
  ordinary business of life it examines that part
  of an individual and social action which is most
  closely connected to the attainment of and the
  use of the material requisites of well-being.
• Alfred Marshall, British economist

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• " Economics is a science that deals with the
  study of human behavior as a relationship between
  ends and scarce means which have alternative
  uses.
• Lionel Robbins, British economist

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• Economics is the proper allocation and efficient
  use of available resources for the maximum
  satisfaction of human wants.

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• Economics is also the study of how human beings
  go about the business of organizing its
  consumption and production activities.
• It is also the study of how to improve society.

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Divisions/Branches in Economics

• Macroeconomics deals with the economic behavior
  of the whole economy or its aggregates such as
  government, business and household
• It is also known as "big" economics, for it
  addresses the issue of unemployment, inflation,
  monetary and fiscal policy for an entire economy.
  

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• It looks at the total output of a nation and the
  way the nation allocates its limited resources of
  land, labor and capital in an attempt to maximize
  production levels and promote trade and growth
  for future generations.
• Macroeconomics is concerned with the discussion
  of topics like gross national product, level of
  employment, national income, general level of
  prices, total expenditures, etc.

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• Microeconomics deals with the economic behavior
  of individual units such as the consumers, firms
  and the owners of the factors of production.
• It is also known as "small" economics, which
  examines the economic behavior of agents
  (including individuals and firms). It studies the
  parts that make up the whole economy.

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• Analyzing certain aspects of human behavior,
  microeconomics shows us how individuals and firms
  respond to changes in price and why they demand
  what they do at particular price levels.
• Such specific economic units constitute a very
  small segment of the whole economy

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• For example, the price of rice, the number of
  workers of San Miguel Corporation, the income of
  Mr. Chua, the expenditures of MERALCO, etc
• When we study the income or family savings bank,
  we are dealing with microeconomics but when we
  deal with the total income or total expenditure
  of the whole banking industry, then we are
  involved in the study of macroeconomics

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• If we discuss the economic crisis of our country,
  we are concerned with macroeconomic analysis
• However, what is true in microeconomics may not
  be true in macroeconomics.

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Some concepts we have to remember

• Scarcity -means that available resources are
  insufficient to satisfy all wants and needs
• Demand - refers to how much (quantity) of a
  product or service is desired by buyers.
• Supply- represents how much the market can offer.
  The total amount of a good or service available
  for purchase

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• Allocation - The systematic distribution of a
  limited quantity resources over various time
  periods, products, operations, or investments.
• Resources- are the inputs that society uses to
  produce output, called goods. Resources include
  inputs such as labor, capital, and land. It
  describes all the things available at our
  disposal that can be used to satisfy our needs.

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Resources can be classified into

• Land - all the natural resources of the earth.
  That includes the fish in the sea, all the
  minerals found in the earth, metals, sand,
  stones, rocks, timber, food from the soil and so
  on.

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• Labour - all the human mental and physical effort
  that goes into production. This will include
  people who work as street cleaners, people who
  are interior designers, teachers, the police,
  doctors, bricklayers, architects and so on. The
  reward for labour is referred to as wages.

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• Capital - all the equipment, machinery and
  buildings that is not used for its own sake but
  for the contribution it makes to production. This
  includes things like office desks and chairs,
  computers, specialist machinery in a factory, the
  coffee machine and so on. The 'price' of
  acquiring capital is referred to as interest.

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• Enterprise - the skills needed to organize other
  resources into some form of production. Some
  people would put enterprise as a specialist skill
  within labour but enterprise does have some
  distinctive characteristics that merit its own
  category. The return for enterprise is called
  profit.

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The 3 Basic Economic Problems

• What goods and services to produce and how much.
• How to produce the goods and services.
• For whom are the goods and services.

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The Basic Economic Problem
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• Questions???

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Conclusion

• The most basic problem in economics is
• "How do we satisfy unlimited needs/wants with
  limited/scarce resources?.
• The right allocation and use of resources is
  the role of both people and government that is
  why the measure of growth and development of the
  country is based on the right economic choice of
  the government.

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• Please standby
• for the next
• class