Name: Saldana, Joshua P.

Section: BSME 4B

1. Definition of Economics

Economics is a social science concerned with the production, distribution and consumption of goods
and services. It studies how individuals, businesses, governments and nations make choices on
allocating resources to satisfy their wants and needs, and tries to determine how these groups
should organize and coordinate efforts to achieve maximum output.

2. Types of Economics

Microeconomics focuses on issues that affect individuals and companies. This could mean
studying the supply and demand for a specific product, the production that an individual or
business is capable of, or the effects of regulations on a business.

Macroeconomics focuses on issues that affect the economy as a whole. Some of the most
common focuses of macroeconomics include unemployment rates, the gross domestic product of
an economy, and the effects of exports and imports.

3. Define the following:

Socialism - a political and economic theory of social organization that advocates that the means
of production, distribution, and exchange should be owned or regulated by the community as a
whole.

Capitalism - an economic and political system in which a country's trade and industry are
controlled by private owners for profit, rather than by the state.

Communism - a political theory derived from Karl Marx, advocating class war and leading to a
society in which all property is publicly owned and each person works and is paid according to
their abilities and needs.