ECONDEV REVIEWER Market System (Application)

Capitalism
ECONOMICS- management of limited resources
to meet unlimited needs and wants. Free Market System – Capitalism
4 BASIC PROBLEMS OF ECONOMY - Many sellers / buyers
- Competition
1. What to produce? - Low price
2. How many?
3. To whom? Oligopoly – Capitalism – Cartel (conspiracy in
4. How is the distribution? terms of price)
SUBSISTENCE - Many sellers / buyers
- High price
TRADE (barter) – product to product exchange.
Monopoly – Command
Money (mercantilism) is the economic term
which means gold or silver; powerful. It is the - One seller / many buyers
power of the country based on the number of - High price
gold or silver.
Monopolistic – Competition – Capitalism.
3G’s God. Gold. Glory.
- Identical products
PHYSIOCRAT
Monopsony – Command
Francois Quesnay
- Many sellers / one buyer
- Circular flow
Gross Domestic Product or GDP
- Rule of nature
- In order to achieve the development of - The final goods within the country.
the country, we must empower the
Farmers. Expenditure Approach
- Simultaneously close of the company is EI + EA + EH + EG (Income, Agriculture,
called Recession, or the rapid increase of Household, Government)
an unemployment. If the company cannot
recover the depression will occur. Income Approach

Adam Smith II + IA + IS + IG (Industry, Agriculture, Service,

Government)
- Capitalism
- Laissez-faire (let alone policy) – the Gross National Product or GNP
government is not involved in private and - Total services or products, inside or
other businesses. outside the country
- Price are dictated by the supply and
demand. GDP + Net Factor Income Abroad or NFIA
- Competition
- Cut-rope competition – pinapabagsak
ang may maliliit o mahihina ang puhunan POVERTY AND UNEMPLOYMENT
sa isang business.
- Negosyante=profit-oriented DEFINITION OF POVERTY

Karl Marx This is defined as the proportion of families

whose income is below the poverty line to the
- Communism total number of families.
- Utopia
- No private property
Poverty is not having enough material Occurs because of an absence of demand for a
possessions or income for a person’s needs. certain type of worker. This typically happens
Poverty may include social, economic, and when there are mismatches between the skills
political elements. Absolute poverty is the employers want and the skills that workers have.
complete lack of the means necessary to meet
Seasonal – occurs when jobs are only available
basic personal needs, such as food, clothing and
at certain times of the year. For example, Santa
shelter.
Claus impersonation.
The subsistence incidence among Filipino
Cyclical – relates to the cyclical trends in growth
families was estimated at 6.2%, lower than the
and production that occur within the businesses
recorded 9.9% in the same period in 2015. The
cycle. When the business cycle is at its peak,
subsistence incidence is the proportion of
cyclical unemployment is low.
Filipino families whose incomes fall below the
food threshold. Frictional – occurs when a worker moves from
one job to another and spend his time trying to
Poverty incidence among the Philippine
find his ideal job. Exists even there is full
population fell to 16.6% in 2018 from 23.3% in
employment.
2015, the Philippine Statistics Authority
(PSA) announced on Friday, December 6. Hardcore Unemployment – is the
unemployment among people who have been
This translates to 17.6 million Filipinos who
unemployed for a long time and who are less
lived below the poverty threshold last year. An
likely to want or find a job.
average Filipino needed at least P2,145 on
average to meet the most basic food and non- Inflation – is a sustained increase in the general
food needs in 2018. price level of goods and services in an economy
over a period of time.
On a per-family basis, the number of poor
families also declined to 12.1% in 2018 from Deflation - deflation is a decrease in the general
17.9% in 2015. price level of goods and services.
This means there were 3 million poor families in Hyperinflation -  is very high and typically
the country who needed an average of P10,727 accelerating inflation.
to meet basic needs in 2018.
Consumer Price Index or CPI - measure that
NATURE OF UNEMPLOYMENT examines the weighted average of prices of a
basket of consumer goods and services.
Unemployment Rate
Inflation Rate Formula
Employment is the number of people currently
employed in the economy, either full-time or CPI Present – CPI Past
part-time.
___________________________ x100
Unemployment is the number of people who
are actively looking for work but aren’t currently CPI Present
employed. CPI FORMULA
The labor force is equal to the sum of TWP Present – TWP Past
employment and unemployment.
____________________________ x100
Types of Unemployment
TWP Present
Structural – results from industrial
reorganization, often due to technological change
rather than fluctuations in supply or demand.