Applied Economics

1. APPLIED ECONOMICS
By: Jean B. Daraug

2. The Fields of Economics
MICROECONOMICS
• focuses on how individual
consumers and firms make
decisions; these individual
decision-making units can
be a single person, a
household, a business or a
government agency.
MACROECONOMICS
• studies an overall economy
on both a national and
international level, using
highly aggregated
economic data and
variables to model the
economy.

3. TANGIBLE GOODS
 Material goods and commodities
INTANGIBLE GOODS
 When they are in the form of services.
Those rendered by doctors, engineers,
nurses and other professional.

4. CLASSIFICATION OF GOODS
CONSUMER GOODS
 Goods for the ultimate consumption of
the consumers. Ex. toothpaste, bath
soap etc.
ESSENTIAL GOODS
 Used to satisfy the basic needs of man.
Ex. Foods and Medicine

5. CLASSIFICATION OF GOODS
ECONOMIC GOODS
 Goods which are useful and scarce; with value attached to them
and a price to be paid for their use. If a good is abundant and it
can satisfy everyone’s needs without anybody paying for it,
then, that good is free. The air is free, but the air from an aircon
is an economic good.
CAPITAL or INDUSTRIAL GOODS
 Used in production of goods and services.
Ex. Building, machinery, equipment etc.
LUXURY GOODS
 Goods man may do without, but may give comfort and
satisfaction. Ex. perfume, cakes, chocolates, expensive cars etc.

6. 1 Whole sheet of paper
(5 minutes)
I. Direction: Please categorize the characteristics of microeconomics and macroeconomics using the
diagram below. This will enhance your creativity to solve issues in the future.
1. Studies the behavior of individual economic
units;
2. Focuses of the behaviour of individual in the
market
3. Focuses on parts of the economy: individuals,
firms, and industries;
4. Studies the economy as a whole
5. Focuses on goals like productions standard of
living, unemployment, and inflation.
6. Policies are focused on monetary policy and
fiscal policy.
7. Studies of markets of good and services

7. ASSIGNMENT
(1/2 Sheet of Paper)
1. State the Law of Supply
2. State the Law of Demand
3.What is Equilibrium Point?