Virtudazo, Ruth T.
BSED-Social Studies
MODULE 1
Learning Task
Worksheet #1
A. Choose a definition for each term. Write the letter of your answer before the number. 10
points.
E 1. Efficiency a. The study of
economic-wide
phenomena
C 2. Opportunity Cost b. Objective
development and
testing of theories
G 3. Economic Models c. Whatever is given up
to get something else
I 4. Microeconomics d. Prescription of how
the world should be
A 5. Macroeconomics e. Getting maximum
output from the
resource available
F 6. Positive Economics f. Description the world
as it is
D 7. Normative Economics g. Simplifications of
reality based on
assumptions
B 8. Scientific Method h. It shows the
combination of output
the economy can
possibly produce
given the available
factors of production
and technology
J 9. Circular flow of i. The study of hoe
diagram households and firms
make decisions and
how they interact in
markers.
H 10. Production Possibilities j. It shows the flow of
Frontiers goods and services,
factors of production
and monetary
payments between
household and firms
B. Venn Diagram
The differences and similarities of microeconomics issues and macroeconomics issues.
10 points.
Microeconomics Macroeconomics
-Covers several
issues like demand, Similarities -Covers several issues
supply, factor pricing, both focus on the like distribution,
product pricing, allocation of scarce national income,
economic welfare, resources. Both employment, money,
production, disciplines study how general price level, etc.
consumption, etc. the demand for
certain resources - major issues of the
- Useful in regulating interacts with the economy like deflation,
the prices of a ability to supply that inflation, rising prices
product alongside the good to determine (reflation),
prices of factors of how to best unemployment and
production (labour, distribute and poverty as a whole
land, entrepreneur, allocate that
capital, etc) within resource among
the economy. many consumers.
C. Identify the parts of circular flow diagram immediately involved in the following transactions
and explain your answer. 10 points.
1. Maria buys a car from Toyota Cars for 500,000.
Market for goods and services Wherein, 500,000 spending from household and give
payment for goods and services into firms. Market for goods and services earned
500,000 revenue to firms. The flow of money goes from household to firms.
2. Toyota Cars pays Jose P18,000/month for his work on the assembly line.
Market factors of production a labor from household to market for production. Earned
18,000 wage from firms to product market. Have an income of 18,000 from market
factors of production to household. The flow of money from firms to household.
3. Jos gets a haircut for P50
Market for and goods and services the market of goods and services earned 50 pesos
from household. 50 pesos of revenue from goods and services to firms. Services from
market of goods and services to household. The flow of money goes from household to
firms.
4. Maria receives P100,000 dividends on her stocks form Toyota Cars
Monetary Payment earned a profit of 100,000 from firms to market of production.
100,000 income from market of production to household. A capital from household to
firms. The flow of money goes from household to firms.
5. Jose bought Maria’s car for P350,000
Monetary payment A buyer pays 350,000 to seller in exchange of a product
compensated by commission a percentage income from sales. The flow of money goes
from household to firms.
D. Short-Answer Questions. 20 points
1. When an economist makes a normative statement, is she more likely to be acting as a scientist
or a policy advisor? Why?
Policy advisor, because a normative statement is cannot be tested. There’s no such evidence to
prove if the statement is true or false. It is a value judgment comes from personal perspective.
2. Which statements are testable: positive or normative statements? Why?
A Positive statement, because it relies on relevant facts supported by evidence which can help
to test the development of economic theories. Wherein, using the algebraic formula for a line
allows economists to find precise points on a graph that help in interpreting how much of a
good should be sold, or at what price.
3. Why does PPF have a negative slope (slope down and to the right)
The slope of the PPF represents the opportunity cost of moving from one combination of goods
to another. The slope will always be NEGATIVE, because there is a trade-off between the two
goods, demonstrating the principles of scarcity and opportunity cost.
4. Why is the PPF bowed outward?
The reason that this curve is bow-shaped is a direct result of the law of increasing opportunity
cost. The more resources that are used the less capable the economy is of sustaining other
forms of production.
