LEARNING ACTIVITY # 1

Name: Score
Program / Course: Class Schedule:
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Type of Activity (check or choose from below)

Concept Notes Laboratory Report Portfolio
Skills: Exercise / Drill / Illustration Others:___________________
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Activity Title : Economic Thinking
u Why It Matters: Economic Thinking, Understanding Economics and
Scarcity
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Learning Target : Define economics and explain that economics is a social science and
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Distinguish between
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microeconomics and macroeconomics
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DO NOT COPY : INTRODUCTION
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Economics is the study of thef way people organize themselves to sustain life and
enhance its quality. Individualsl engage in four essential economic activities: resource
maintenance, production of goods a and services, distribution of goods and services, and
consumption of goods and services.k Resource maintenance means tending to, preserving,
or improving the natural, produced,
e human, and social resources that form the basis for
the preservation and quality of life.
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Understanding Economics and Scarcity
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• Scarcity means that there are never enough resources to satisfy all human wants.
• Every society, at every level, must make t choices about how to use its resources.
• Economics is the study of the trade-offs h and choices that we make, given the fact of scarcity.
• Opportunity cost is what we give up v when we choose one thing over another.
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Goods and Resources
• Economic Goods: goods or services ar consumer must pay to obtain; also called scarce goods.
• Free Goods: goods or services that a consumer
y can obtain for free because they are abundant relative to the
demand. i
• Productive Resources: the inputs used in the production of goods and services to make a profit: land, economic
n called “factors of production”
capital, labor, and entrepreneurship; also
• Micro vs. Macro g
• Macroeconomics: the branch of economics n that focuses on broad issues such as growth, unemployment,
inflation, and trade balance.
• Microeconomics: the branch of economics u that focuses on actions of particular agents within the economy, like
households, workers, and businesses. We m learn about the theory of consumer behavior and the theory of the firm.
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Questions Fill in the banks: e
1. While the study of economic activities ofrindividuals, households, and business at the
sub-national level is the concern of_____ s
the national and global level is the concern of_________
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, the study of economic activities of_____ f
2. Questions about facts or “how things are”l are______about values and “how things should be”
are__________ questions,
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3. The three main macroeconomic goals identified in this chapter are ,______
,______ and ________. n
4. The process of moving from a situation ofe poverty and deprivation to a situation of
increased production and plenty is referred to o as_______ .
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THIS FORM IS FOR INSTITUTIONAL PURPOSES ONLY!
LAS 1 Continuation

True or False
1. Economic phenomena such as the rate of unemployment and inflation are studied in
microeconomics.

2. Living standards growth is defined as increases in the level of production in a

country or region.
3. During a recession, the economy often has higher rates of unemployment, whereas
during a boom, the economy often has higher rates of inflation.

Multiple Choice:

1. With what kinds of topics does macroeconomics concern itself?

a. Economic activities of individual firms, households, and other organizations
b. Forces of supply and demand in a particular market
c. Consumer behavior and firms output decisions
d. The labor market, wages, and hiring decisions
e. Aggregate economic phenomena like the rate of unemployment and inflation

2. Which of the following is an example of a normative question?

a. What is the nation’s rate of economic growth?
b. What is the nation’s rate of inflation?
c. What is the nation’s rate of unemployment?
d. What is the nation’s level of GDP?
e. Is the goal of sustainability of greater importance than the goal of economic growth
as we move into the 21st century?

3. Which of the following is one of the three macroeconomic goals discussed in the text?
a. Growth in the size of corporations
b. Living standards growth
c. Growth in trade and globalization
d. Technological innovation
e. None of the above

4. Which of the following is not an example of one of the three macroeconomic goals
discussed in the text?
a. Preventing the economy from experiencing too much unemployment.
b. Preventing the economy from experiencing too much inflation.
c. Keeping living standards high enough for people to live decent, meaningful lives.
d. Making sure the economy is sustainable into the future.
e. Providing the best environment for corporations.

5. What explains the fact that the value of global production grew by a factor of 6.7
between 1960 and 2015, while the value of global production per capita has grown by a
factor of 2.8?
a. Global population also grew, though not as fast as total production.
b. The increase in global production has occurred simultaneously with a decline in
global population.
c. The increase in global production has occurred simultaneously with growth in the
global workforce.
d. The increase in global production has occurred simultaneously with decline in
the global workforce.
e. The growth in the global population has been greater than the growth in global
production.

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 LEARNING ACTIVITY # 2
Name: Score
Program / Course: Class Schedule:
Year & Section: Contact No. / FB Account:
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Type of Activity (check or choose from below)

Concept Notes Laboratory Report Portfolio
Skills: Exercise / Drill / Illustration Others:___________________

• Activity Title C
: Economic Models and Purpose of Functions
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Learning Target : Define an economict model and explain the process of model building in economics
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DO NOT COPY : n
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Using Economic Models Economic Model: a simplified version of reality that allows us to observe,
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understand, and make predictions about economic behavior.
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Economic Models and Math l
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• Economic models can be represented k using words or using mathematics.
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• Algebra and graphs are utilized to explains economic models.
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• Circular Flow Diagram: a diagram indicating that the economy consists of households and firms
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interacting in a goods-and-services market
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and a labor market.
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• goods-and-services market (also called the product market), in which firms sell and households buy.
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• labor market, in which households asell labor to business firms or other employees.
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• real world, there are many differenty markets for goods and services and markets for many different
types of labor. The circular flow diagram
i simplifies these distinctions in order to make the picture
easier to grasp n
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• Function: a relationship or expression n involving one or more variables.
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In economics, functions frequently describe cause and effect.
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b explained (“the effect”).
The variable on the left-hand side is what is being
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On the right-hand side is what’s doing the explaining
r (“the causes”).
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Economic models tend to express relationships using economic variables, such as:
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Budget = money spent on econ books + moneyfspent on music
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Identification: i
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1. The fluctuations in the level of production, including recessions on the one hand
and booms on the other hand, is called______ e.
o to future generations is the goal of
2. The goal that recognizes a serious responsibility
.______ f
3. The school of economics that is associated with
s the idea that individual self-interest is
a positive force and that governments should let y markets function without interference is
called_____ .
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Continuation LAS 2

4. The economist who argued that the market mechanism can fail by leaving insufficient
demand and that governments could intervene by increasing aggregate demand was
named_____ .
5. The school of thought that argued that governments should aim for steadiness in the
money supply rather than play an active role is called ______.

True or False
6. Monetarists believe the government should change money supply to boost
aggregate demand during a recession.
7. According to the Keynesians, the government can reduce unemployment through
changes in its spending and taxation policies.

Multiple Choice:

8. How is labor productivity defined?

a. The level of output produced per capita.
b. The level of output produced per worker (or worker-hour).
c. The level of output produced as a share of GDP.
d. The level of human capital in the workforce.
e. The level of output produced per capital input.
9. What problems are we most likely to see at which stage of the business cycle?
a. High inflation during recessions.
b. High unemployment during booms.
c. Low inflation during booms.
d. High unemployment during recessions.
e. Both high unemployment and high inflation during booms.
10. Why is the instability of the business cycle a problem?
a. During recessions there is high unemployment, and resources are underutilized.
b. High unemployment is associated with individual and social stress, such as
suicide, domestic violence, illness and crime.
c. During booms, high inflation can erode purchasing power, savings and pensions.
d. Unpredictable fluctuations in rates of inflation, interest rates, and foreign
exchange rates make it difficult for individuals and organizations to plan for the
future.
e. All of the above.

11. Which of the following is not an issue concerning social sustainability?

a. The disparities between the “haves” and the “have-nots.”
b. The ability of the next generation to contribute to a healthy economy and society
c. The need for steady growth in production
d. The creation of social disruption and political strife
e. The ability of the next generation to experience social and political participation and
inclusion.
12. Which of the following best describes the precautionary principle?
a. Clear cause and effect relationships must be established before taking action.
b. We should err on the side of caution when dealing with natural systems or
human health.
c. The benefits of economic production and growth outweigh the risks of damage
to natural systems or human health.
d. Business should not have to prove a product to be safe before being released on
the market; rather a product must be proven unsafe before it is banned and pulled
from the market.
e. We should take precautions before engaging in risky business investment.

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 LEARNING ACTIVITY # 3
Name: Score
Program / Course: Class Schedule:
Year & Section: Contact No. / FB Account:
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Type of Activity (check or choose from below)

Concept Notes Laboratory Report Portfolio
Skills: Exercise / Drill / Illustration Others:___________________

• Activity Title C
: , Budget Constraints and Choices and Productive Efficiency and Allocative Efficiency
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• Learning Target : Explain how budget constraints impact choices and
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This chapter introduces standard concepts ofw economic modeling, efficiency, scarcity, opportunity cost, the
Production Possibilities Frontier, and includes
f a review of graphing techniques. It describes two different
macroeconomic models: the neoclassical model l and the contextual model. It also provides an overview of the
three spheres of economic activity: the core sphere, the public purpose sphere, and the business sphere. In this
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chapter you will see these concepts set into a broader context of concern for well-being.
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• Budget Constraint: refers to all possible combinations of goods that someone can afford, given the
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prices of goods and the income (or time) we have to spend.
• Sunk Costs: costs incurred in the past w that can’t be recovered.
• Opportunity Cost: measures cost by i what is given up in exchange; opportunity cost measures the value
of the forgone alternative. t
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Identification:
1. The observation and recording of specificb phenomena of concern is called_______
investigation, whereas the analysis based ineabstract thought is called
investigation. r
2. When researchers study past events, theysare conducting a(n)___________
investigation. o
3. The Latin phrase that means “all else constant”
f or “other things equal” is __________.
4. A diagram that shows the tradeoffs betweenl
production of two goods is called a(n)
.
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5. You’re deciding whether to take an Economics course, or to take an Anthropology
course. The ___________cost of taking the nEconomics course is the course
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you’re having to forego, the Anthropology course
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Continuation of LAS 3
Multiple Choice:
1. Suppose an investigator has 50 years of data on rates of industrial production and
annual accumulations of CO2, and discovers a positive relationship between the two
variables. This is an example of what type of investigation?
a. Theoretical investigation
b. Empirical investigation
c. Historical investigation
d. Both A and B.
e. A, B, and C.
2. What does the Production Possibilities Frontier represent?
a. A catalog of all possible production options, represented as percentages.
b. The tradeoffs between production and consumption options.
c. The tradeoffs between possible production levels for two goods.
d. The amount that a society could produce if it devoted all its resources to
producing one good.
e. The possible gains from international trade in two or more goods.
3. Which of the following factors could expand a society’s production possibilities
frontier?
a. Increased butter production.
b. Shifting from one product to another.
c. Producing air pollution.
d. Depleting resources now instead of later.
e. Technological innovations.

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 LEARNING ACTIVITY # 4
Name: Score
Program / Course: Class Schedule:
Year & Section: Contact No. / FB Account:
Residential Address:

Type of Activity (check or choose from below)

Concept Notes Laboratory Report Portfolio
Skills: Exercise / Drill / Illustration Others:___________________
Activity Title C Possibilities Frontier
: The Production
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Learning Target : Use the production possibilities frontier to identify productive and allocative efficiency
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NOTE: DO NOT COPY s
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Production Possibilities Frontier (or Curve): a diagram that shows the productively efficient combinations of
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two products that an economy can produce given the resources it has available.
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Similarities with Individual Constraints:
• While individuals face budget and timef constraints, societies face the constraint of limited resources (e.g. labor,
land, capital, raw materials, etc.). l
• Because at any given moment, society ahas limited resources, it follows that there’s a limit to the quantities of
goods and services it can produce. In other
k words, the products are limited because the resources are limited.
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Differences Between an Individual’s Budget Constraint and a PPF
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• The general rule is when one is allocating only a single scarce resource, the trade-off (e.g.
budget line) will be constant, but w when there is more than one scarce resources, the trade-off
will be increasingly costly (e.g. the i PPF).
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Law of Diminishing Returns: as additional
h increments of resources are devoted to a certain purpose,
the marginal benefit from those additional
v increments will decline.
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Law of Diminishing Returns and the Curved r Shape of the PPF Example:
• If few resources are currently committed
y to education, then an increase in resources used can
bring large gains. i
• If a large number of resources aren already committed to education, then committing additional
resources will bring smaller gains. g
• The curve of the PPF shows as additional
n resources are added to education, moving from left
to right on the horizontal axis, theu initial gains are large, but those gains gradually diminish.
Why Society Must Choose: Every economy m faces two situations in which it may be able to expand
the consumption of all goods. b
• A society may be using itseresources inefficiently, in which case by improving efficiency
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and producing on the production possibilities frontier, it can have more of all goods (or
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at least more of some and less of none).
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• As resources grow over a period of years (e.g., more labor and more capital), the
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economy grows. As it does, the production possibilities frontier for a society will tend to
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shift outward, and society will be able to afford more of all goods.
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Multiple Choice:
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1. Suppose an investigator has 50 years of data on rates of industrial production and
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annual accumulations of CO2, and discovers a positive relationship between the two
o investigation?
variables. This is an example of what type of
a. Theoretical investigation f
b. Empirical investigation s
c. Historical investigation y
d. Both A and B. m
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THIS FORM tIS FOR INSTITUTIONAL PURPOSES ONLY!
Continuation of LAS 4

2. What does the Production Possibilities Frontier represent?

a. A catalog of all possible production options, represented as percentages.
b. The tradeoffs between production and consumption options.
c. The tradeoffs between possible production levels for two goods.
d. The amount that a society could produce if it devoted all its resources to
producing one good.
e. The possible gains from international trade in two or more goods.
3. Which of the following factors could expand a society’s production possibilities
frontier?
a. Increased butter production.
b. Shifting from one product to another.
c. Producing air pollution.
d. Depleting resources now instead of later.
e. Technological innovations.

4. Which of the following events could cause the PPF to shift out?
a. Workers become less productive due to poor working conditions.
b. A hurricane destroys vital resources for pencil production.
c. A new machine is invented that makes it easier to produce both pencils and
erasers.
d. All production costs rise proportionally.
e. The cost of eraser inputs goes up.
5. Which of the following statements is true?
a. Moving from point C to point B requires shifting resources away from eraser
production and into pencil production.
b. Point B represents a less efficient resource mix than point C.
c. Depletion of nonrenewable resources could lead the economy to shift from
point C to point D.
d. Utility is maximized at point A.
e. At point A, society is producing all the pencils it can.

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 LEARNING ACTIVITY #5
Name: Score
Program / Course: Class Schedule:
Year & Section: Contact No. / FB Account:
Residential Address:

Type of Activity (check or choose from below)

Concept Notes Laboratory Report Portfolio
Skills: Exercise / Drill / Illustration Others:___________________
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Activity Title : Productive Efficiency
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Learning Target : Use the production
t possibilities frontier to identify productive and allocative efficiency
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Continuation of LAS 5

Problem Solving:

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