Economics and others

ECONOMICS and OthersECONOMICS and Others

Mr. Rey BelenMr. Rey Belen

Divisions of Economics

Macroeconomics Microeconomics• The study of economy as a whole. • Management of income,

expenditures, wealth, or resources of a nation

• It deals with the aggregates or totals and studies market activities as a whole. Answers the questions:

1. What factors determine the total level of production

2. Should the government increase tax?

3. How will an increase in money supply affect the economy of the nation?

Analyzed problems and issues concerning:

1. Inflation2. Unemployment3. Growth and International Finance

• The study of activity in individual markets.

• Studies the action of individual firms and households.

It involves specific market such as those for :

1. Rice2. Sugar3. Coconuts4. Apparels5. TelevisionsIssues:1. Price Determination2. Monopoly3. Big Business Empires4. Labor Unions

The Physicist and the Economist

• Deal with material object

• Deriving laws that are more or less stable if the conditions under which the laws formulated remains the same

• 2 Hydrogen + Oxygen = H20

• Deal with human being and human behavior

• Human behavior is not always predictable

• The same individual may react to the same conditions differently at different times; or one individual may react differently from the way another individual would react.

Economics as a Science

Economist (same other scientists) also work in a similar way

1. They used economic theories to explain how the economy works.• Oftentimes, more people are at the

bargain counters of department stores compared to regular counters.

• when departments stores and groceries conduct a “sale”, people rush to the said establishment and buy plenty of goods.

Therefore…

“IF THE PRICE OF GOODS FALL, PEOPLE WILL

WANT TO BUY MORE”

2. He gathers data, compares data against his hypothesis, validates his hypothesis…

concludes that:

“ A DECREASE IN THE PRICE OF A

PARTICULAR GOOD MAKES CONSUMER

WANT TO PURCHASE MORE OF THAT GOOD”

Why Economics is regarded as a science?

• It is an organized body of truth,

• Coordinated,• Arranged, and• Systematized with

reference to certain general laws and principles

• However, laws and principles of economics are not as universal as the laws in physical science

• Law of Diminishing Return• Law of Supply and

Demand• It is more difficult to

formulate universal laws in economics since individuals are being dealt with.

• Reactions to a given set of conditions will vary because of differences in personality, environment, IQ and other factors.

Relationship of Economics to Other Sciences

Math

• Economic theory and analysis make use of algebra, calculus, and mathematical programming.

• Mathematical process are involved in the construction of graphs and charts and in the tabulation of statistical data

• Findings from Biological studies greatly influence trends in the market, agricultural production, and consumption.

Biology

• Economics and Sociology are allied studies for both deal with individual’s relation to society since that society affects his or her behavior and way of life.

• Both History and Economics deal with how a country struggle and its progress .

• The study of History involves the study of Economics and vice versa for both are Social Sciences.

Sociology History

• Ethics points out the right and the wrong conduct in such matters as wealth, production, consumption, exchange, wage, profit, strike, labor, and private property.

• Leveling influence

• Civic problems are interrelated with Economic problems.

• Civics deals with the problems of the government in maintaining a well-ordered society.

• Economics treats these problems which individuals have to face as they participate in the affairs of the community.

Ethics Civics

• There is definite relation exists between Economics and Psychology.

• The mere desire for good is a psychological fact; but when that desire is expressed in the purchase of those goods that psychological fact becomes economic fact.

Psychology

Fundamental Emphases or Concerns of Economics

Economic is concerned with:

PRODUCTION

DISTRIBUTION

CONSUMPTION

PUBLIC FINANCE

IMPORTANCE

• the practice of thrift and wise consumption of goods, services and resources

• The appreciation of the value of wealth

• The understanding and learning of the meaning of sacrifice and savings in order to attain individual and social objectives.

• These attitudes,when developed among the young, can contribute to nation building and help speed up the development of a country.

ECONOMIZING