Soc Sci Notes
Contents:
Page 2 - Economics, Scarcity and Choices
Page 5 - The Filipino Consumer
, Lesson 1.1 - Economics, Scarcity, and Choices
What are Economics:
- Originated from the Greek word oikonomia (oikes and nemien)
- Means “management of the household”
- Explores the best possible utilization of limited resources and its goal is to optimize the
production of goods and services for the satisfaction of humans’ wants.
The Fundamental Economic Problem:
- People encounter economic problems when they cannot satisfy their needs and wants
- Economics call this problem “scarcity”
- What is scarcity:
- Universal phenomenon
- All countries suffer scarcity no matter how resourceful they are
- Relative scarcity: One may lack resources, but could have plenty of others
- Two conditions for a resource to be scarce:
1. It must be useful
2. Resource must be limited in supply relative to the demand for it.
The Economic Problem of Choice:
- Trade off:
- Alternatives given up in choosing a particular use of a resource.
- Ex: One land is used for farmine, it cannot be used anymore, at the same time,
for other resources.
- Opportunity Cost Theory:
- When choices are narrowed down to two best possible options, the theory of
opportunity cost influences the decision.
- Opportunity cost is the next best alternative use of a resource foregone.
- Applies in individual situations and they always encounter it everytime they make
a decision. Wise choices yield less opportunity cost.
Contents:
Page 2 - Economics, Scarcity and Choices
Page 5 - The Filipino Consumer
, Lesson 1.1 - Economics, Scarcity, and Choices
What are Economics:
- Originated from the Greek word oikonomia (oikes and nemien)
- Means “management of the household”
- Explores the best possible utilization of limited resources and its goal is to optimize the
production of goods and services for the satisfaction of humans’ wants.
The Fundamental Economic Problem:
- People encounter economic problems when they cannot satisfy their needs and wants
- Economics call this problem “scarcity”
- What is scarcity:
- Universal phenomenon
- All countries suffer scarcity no matter how resourceful they are
- Relative scarcity: One may lack resources, but could have plenty of others
- Two conditions for a resource to be scarce:
1. It must be useful
2. Resource must be limited in supply relative to the demand for it.
The Economic Problem of Choice:
- Trade off:
- Alternatives given up in choosing a particular use of a resource.
- Ex: One land is used for farmine, it cannot be used anymore, at the same time,
for other resources.
- Opportunity Cost Theory:
- When choices are narrowed down to two best possible options, the theory of
opportunity cost influences the decision.
- Opportunity cost is the next best alternative use of a resource foregone.
- Applies in individual situations and they always encounter it everytime they make
a decision. Wise choices yield less opportunity cost.
