The document discusses the application of supply and demand analysis. It covers the following key points: 1. The law of supply and demand states that prices are determined by the relationship between supply and demand. If supply exceeds demand, prices fall, and if demand exceeds supply, prices rise. 2. Supply and demand analysis assumes competition exists among buyers and sellers, and that it can be applied to all markets and prices that exist. 3. The interaction of supply and demand determines both the quantity sold and the price simultaneously. Forces like weather can affect supply and demand. 4. During an emergency like a typhoon, demand increases while supply remains fixed, causing prices to rise sharply as supplies are depleted.

1. APPLICATION OF
SUPPLY
AND DEMAND
ANALYSIS

2. LAW OF SUPPLY AND DEMAND
• The law of SUPPLY and DEMAND is the theory
that prices are determined by the relationship
between supply and demand. If the supply of a
good or service outstrips the demand for it, prices
will fall. If demand exceeds supply, prices will rise.

3. Assumptions of Supply
and Demand
Analysis
•Appropriate to use when competition exists
among buyers and sellers.
•The interaction of buyers and sellers covers
all types of prices and goods for which a
market exists.

4. Assumptions of Supply and
Demand Analysis
Interaction of supply and demand solves two
major economic problems simultaneously the
quantity sold and the price.
Forces affecting supply and demand could
come from any number of influences.

5. EFFECTS OF A CHANGE IN DEMAND
DURING AN IMMEDIATE PERIOD
EMERGENCY
• Figure 5-1 (a) shows what happens in the immediate
period ( during the typhoon ), as consumers brace for
emergency. Supplies are fixed and demand is fairly
inelastic. An increase in demand could lead to a shift of
the demand schedule more goods are bought as long
as these are available. The ensuing price increase
could be steep as shelves are emptied.

6. EFFECTS OF A CHANGE IN DEMAND
DURING AN IMMEDIATE PERIOD
EMERGENCY
• The initial equilibrium price Po and quantity is Qo.
After the increase in demand , when all supplies are
being bought, the price shifts to P1, but quantity
stays the same ( in the immediate period the
supplies are fixed).

7. SUPPLY AND DEMAND FOR FISH
DURING TYPHOON
• Figure 5-1 (b) indicates the short-run setting of a typhoon
period for a particular commodity-fish.
• Fish catch will fall because fisherman will not go to
the sea. The decline in fish supply will cause the
new equilibrium at P1 and Q1. The price of fish will rise
and quantity bought will fall.

8. INTERPLAY OF DEMAND AND SUPPLY
• Normal equilibrium is Po and Qo, during a typhoon,
fish pond owners attempt to harvest bangus for fear
of losing fish if the ponds overflooded and the fish
got out. If flooding occurs, there will be free bangus
harvests in main estuaries caught by people in the
area.

9. INTERPLAY OF DEMAND AND SUPPLY
• On the other hand, people who normally eat other
types of fish will experience a short period rise of
fish prices. Other fishes will have fewer harvests
because fisherman go back to safety during a
typhoon and they have no catch. These people will
likely cause the demand for bangus to increase
(shift D to the right).

10. A. Price Stabilization
of
Basic Commodities

11. Prize Stabilization of
Basic Commodities
• Price stabilization is best undertaken through indirect
approaches by managing the supply of the commodity.
• It could mean influencing only the market conditions,
mainly through the supply side, to avoid extreme swings of
prices.
• Includes setting the prices of commodities that are being
stabilized.

12. Stabilizing Rice Prices
PRIZE STABILIZATION
 Price of grain could rise and fall during the year without
price stabilization. During normal P and Q are equilibrium
price and quantity. The price of grain could go to Pp during
times when supply is getting depleted,( situation A). But
during harvest time when supply is increasing, the price
could go to Ph,( situation B). The objective of stabilization is
to set the price towards P.

13. B. Labor, Supply,
Papulation Growth
and Wage

14. Labor, Supply, Population Growth
and Wage
• The wage rate, which represents the incomes of
workers, provides some indication of the standard of
living.
• High wages result from the interaction of
the demand and supply of labor.
• In countries where the supply of labor is very abundant,
many workers are willing to accept low wages in
exchange for their services.

15. The Wage rate and the Supply
and Demand for Labor
• The wage rate is determined by the balance of supply
and demand for labor. The supply of labor could be
available at a given wage rate, w*, if the supply of labor
is infinitely elastic at that wage rate. But beyond a given
point such as point a, when the labor available at that
wage is fully employed, at point L*, the supply schedule
of labor could rise as shown in the figure.

16. Unequal Population Growth
•POPULATION GROWTH
•Assume two countries identical in all aspects
including their initial level of population. But A
has a 1.0 % per annum growth of population;
B has 2.0%. What happens 10 years lates?

17. Unequal Population Growth
•In country A, with a lower population
growth, the supply curve of labor turns up
more quickly than Sg. 10 years later A
has higher wages than B because the
labor supply is greater in B where the
population growth is higher.

18. Unequal Output Growth
• GROWTH IN DEMAND FOR LABOR
•The two countries are identical in all aspects,
except that country T has a stronger demand
for labor than country P 10 yrs. Later.
Policies in T encourage a growth demand for
labor that is faster than in P.

19. Unequal Output Growth
• Initially the two countries have an identical demand for
labor. 10 years. later, because of sound economic policies
and growth of business investment and productivity, the
demand for labor is higher in T than in P.
• The result, T is securely on a raising portion of the S
schedule for labor. Also, amount of new employment is
more than in P, L 10 years later in T is higher than in P. as
important W 10 years later in T is much higher than in P.

20. Labor Migration Within a Country
• LABOR MIGRATION AND WAGES
• At equilibrium before in-migration, Urbanya has a higher wage
than Probinsya which will induce labor to move to Urbanya.
Suppose this movement is about 100 thousand man years for
a given year, the labor supply in Probinsya falls from Sp to S p
by the amount equal to 100 thousand man years. But the
labor supply schedule for Urbanya rises from Su to S u. In
probinsya, equilibrium wage goes up from Wp to W while in
Urbanya, wage goes down from Wu to W' u.

21. Commodity Taxation
Price and Quantity After Text
• EFFECTS OF A COMMODITY TAX
• The supply schedule before tax is S and other tax is S
tax. A commodity tax has the effect of raising the price
of the good and reducing the quantity sold. The extent
of the changes in price and quantity depends on the
elasticity of supply and demand.

22. Commodity Taxation
Price and Quantity After Tax
• Equilibrium before tax is P and Q the supply
schedule after tax, S tax, intersect the demand
and curve at equilibrium price, P tax. The
new equilibrium quantity after tax is Q tax. It is
clear from this that the new price is higher than
the old price and quantity after tax is smaller than
the quantity before tax.

23. C. Labor Migration
and
The OFW Phenomenon

24. What is Migration?
 MIGRATION - refers to the movement of people from one place
to another.
 2 TYPES OF MIGRATION
a. INTERNAL MIGRATION – refers to the movement of people
within one county i.e. Rural to urban migration.
b. INTERNATIONAL MIGRATION – refers to the movement of
people from one country to another.

25. CAUSES OF MIGRATION
 POVERTY
 UNEMPLOYMENT
 VICTIMS OF NATURAL CALAMITIES
 IMPROVE STANDARD OF LIVING
 BETTER EDUCATION
 BETTER INVIRONMENT
 ECONOMIC SECURITY

26. EFFECTS OF MIGRATION
POSITIVE EFFECTS NEGATIVE EFFECTS
INCREASE LABOR SUPPLY OVERCROWDING
CHEAP LABOR LACK OF HOUSING FACILITIES
TRAFFIC CONGESTION
HEAVY POLLUTION IN AIR, WATER,
NOISE
UNEMPLOYMENT
OCCURRENCE OF SQUATTER
AREAS

27. WHAT IS LABOR MIGRATION?
LABOR MIGRATION – Is the process of
shifting a labor force from one physical
location to another.
Labor migration takes place with the
support of labor force.

28. CAUSES OF LABOR MIGRATION
1.The desire of job seekers to increase income and
to improve the standard of living.
2.The emergence of new industries.
3.The relocation of production facilities of a given
business to a new area.

29. THE OFW PHENOMENON

30. What are OFW s
 Overseas Filipino Workers (OFWs) - are
Filipinos who are presently and temporarily
working outside the country. They may be land-
based of sea-based workers.
Ex. Domestic Helpers, Teachers, Seaman, Nurses

31. REASONS BEHIND THE OFW
PHENOMENON
1. High Unemployment Rate
- Newly graduates join the labor force that
increases the labor force that increases the
competition in the labor market. Instead of
waiting for them to be hired locally, Filipinos
seek employment overseas.

32. REASON BEHIND THE OFW
PHENOMENON
• 2. Low Salary offered by employers in the Philippines
- Filipinos are willing to work abroad due to low
salary. Even professionals like nurses, engineers
and teachers would prefer to work abroad as
household help or office workers because of the
higher salary offered overseas

33. REASON BEHIND THE OFW
PHENOMENON
3. Discrimination in job hiring in the Philippines
- Local employers tend to hire candidates even
if they are not the most qualified for jobs. The
qualified and overage applicants who were not
able to find jobs decide to work abroad.

34. REASONS BEHIND THE OFW
PHENOMENON
4. High Withholding Tax
- The Philippines has a high income tax rates for
workers. Workers take home pay decrease after
deducting the withholding tax, GSIS/SSS premium,
Pag - ibig and Phil-health and other mandatory
deductions.

35. D. THE PHILIPPINE PESO AND
THE FOREIGN CURRENCY

36. OBJECTIVES:
Enumerate the different types of
Filipino peso bill.
Analyze the impact of money and
foreign exchange in our country.

37. THE FILIPINO PESO
The Philippine peso (Filipino: piso; sign: P; code:PHP) is the
official currency of the Philippines. It is subdivided into 100
centavos(Filipino: sentimo).
The peso is usually denoted by the symbol ''P"
The Philippine coins and banknotes are minted and printed at the
Security Plant Complex of the Banco Sentral ng Pilipinas (
Central Bank of the Philippines ) in Quezon City.

38. THE PHILIPPINE PESO
THE PHILIPPINE PESO
THE 10 PESOS BILL
THE 20 PESOS BILL
THE 50 PESOS BILL
THE 100 PESOS BILL
THE 200 PESOS BILL
THE 500 PESOS BILL
THE 1000 PESOS BILL

39. What is Currency?
In economics, currency is a generally accepted medium
of exchange.
An exchange rate is the rate which one currency may be
converted into another, also called rate of exchange of
foreign exchange rate or currency exchange rate.

40. What is Currency?
The foreign exchange rate is simply the price of
one currency in terms of another, or how much one
currency can be exchanged for another, in the
same way that the price of a good is determined by
how much money can be exchanged for it.

41. MONEY CHANGING
The main function of a foreign exchange department is
to make money for the bank by speculating on whether a
particular currency will rise or fall against another. Banks
compete fiercely with each other using experienced
market traders and millions of dollars or currency
equivalents are exchanged daily.

42. FOREIGN EXCHANGE MARKET
The foreign exchange market (
forex, FX, or currency market ) is a
form of exchange for the global
decentralized trading of
international currencies.

43. FOREIGN EXCHANGE MARKET
Foreign exchange transaction is a type of currency transaction
that involves two countries. Generally, a foreign exchange
transaction involves conversion of currency of one country with
that of another. The conversion of currency in a foreign exchange
transaction can be performed through:
1. Buying or selling of goods and services on credit;
2. Borrowing or lending funds.

44. WHAT ARE THE FUNCTIONS
OF FOREIGN CURRENCY
EXCHANGE MARKETS?

45. PRIMARY FUNCTION
The primary function of foreign currency
exchange markets is to convert the
currency of one country into another
currency.

46. INTERNATIONAL TRANSACTION
Foreign currency exchange markets
serve to facilitate international
financial transactions.

47. CURRENCY VALUE
The value of a country's currency can
influence international trade,
consumers purchasing power and
inflation.

48. LOSS PROTECTION
International companies that work in
multiple countries are subject to gains
and losses based on exchange rate
fluctuations.

49. FOREX TRADING
Forex the word, means FOReign EXchange market. This is an
international market where the buying and selling of money is
done freely and 24 hours a day. All forex trading involve the
buying of one currency and the selling of another,
simultaneously. Currency quotes are given as exchange rates;
that is, the value of one currency relative to another. The relative
supply and demand of both currencies will determine the value of
the exchange rate.

50. FOREX TRADING
The trading of foreign currency is the exchange of money
issued in one country for money issued in another.
Foreign currency trading takes place in the highly-solvent
foreign exchange market. Currencies are traded for one
another at exchange rates, which are relative prices
determined by market supply and demand.

51. Here are some simple tips that will help you
increase your profit potential
and prevent you from losing money.
1. SELECT YOUR FIRST BROKER
2. GET A SIMPLE METHOD YOU UNDERSTAND
3. TRADE THE BIG TRANDS AND NOT TRADE FREQUENTLY
4. WORK SMART AND NOT HARD
5. THE FORMULA TO SUCCESS
USING SIMPLE METHOD – WITH DISCIPLINE – CONTROL
RISKS = FOREX TRADING SUCCESS

52. WHAT IS FOREIGN EXCHANGE
RISK?
Exchange risk is simple in concept: a
potential gain or loss that occurs as a
result of an exchange rate change.

53. LIST OF CURRENCIES
Aside from the US Dollar, BPI Forex Corporation
transacts in the following currencies.
AUSTRALIAN DOLLAR CHINESE YUAN
KOREAN WON EURO
BAHRAIN DINAR HONG KONG DOLLAR
BRITISH POUND INDONESIAN RUPIAH
BRUNEI DOLLAR JAPANESE YEN
CANADIAN DOLLAR MALAYSIAN RINGGIT

54. NEW ZEALAND DOLLARS SWISS FRANC
SAUDI RIYAL TAIWAN DOLLARS
SINGAPORE DOLLAR THAILAND BAHT
SWEDISH KRONER
LIST OF CURRENCIES
Aside from the US Dollar, BPI Forex Corporation
transacts in the following currencies.

55. BPI FOREIGN EXCHANGE
CURRENCIES BUYING ( In Philippine
Peso)
SELLING (In Philippine
Peso)
US DOLLAR 47.7500 42.5200
EURO 48.4700 52.5700
BRITISH POUND 61.7800 66.3000
AUSTRALIAN DOLLAR 39.6400 44.1600
JAPANESE YEN 0.5084 0.5509
CANADIAN DOLLAR 38.4400 42.7600
SWISS FRANC 49.8500 44.1700

56. CURRENCIES BUYING (In Philippine Peso) SELLING (In Philippine Peso)
HONGKONG DOLLAR 5.3300 6.0000
SINGAPORE DOLLAR 32.6200 33.9500
BRUNEI DOLLAR 32.5400 34.0300
THAILAND BAHT 1.2900 1.5000
INDONESIAN RUPIAH 0.0042 0.0053
SAUDI RIYAL 10.9000 11.6000
MALAYSIAN RINGGIT 12.9000 13.6700
NEW ZEALAND DOLLAR 32.6400 34.1300
BAHRAIN DINAR 109.0400 113.5100

57. E. THE PHILIPPINE HOUSING
SHORTAGE AND REAL STATE BOOM
• OBJECTIVES
1.List the factor affecting housing needs.
2.Identify the housing problems in the Philippines.
3.Know the government helps to solve housing
problems.

58. FACTORS THAT AFFECT
HOUSING NEEDS

59. FACTORS THAT AFFECT HOUSING
NEEDS
•The first step in buying a home is knowing
what type of housing best suits your family
needs. Housing needs a vary perception
of what you need in the house.

60. FACTORS THAT AFFECT HOUSING
NEEDS
1. CLIMATE – can vary from warm to cold and from dry to humid.
2. LOCATION – the specific placement of a home.
3. COST – is the crutial factor in housing needs for almost everyone.
4. TASTE – this is the sense of what is fitting, harmonious or
beautiful.
5. LIFESTYLE – when selecting a home, one needs to consider the
lifestyles of all family members.

61. HOUSING PROBLEMS
1.Migration of people from rural areas to urban areas
2.Robust population growth.
3.Poverty due to unemployment.
4.Industrialization
5.Minimum wage of Filipinos.

62. THANK YOU FOR LISTENING!