AS BAC ELEC 3 Module 1

Republic of the Philippines
City of Olongapo
GORDON COLLEGE
COLLEGE OF EDUCATION, ARTS AND SCIENCES
Olongapo City Sports Complex, Donor St., East Tapinac, Olongapo City 2200
Telefax No.: (047) 602-7175 loc 322
www.gordoncollege.edu.ph
Class Code : 35690

Course Code : AS BAC ELEC B3
Course Title : ECONOMICS
Class Schedule : FRI 7:00AM-10:00AM
Units : 3 units/hrs
Course Description
The course leads the students to demonstrate knowledge in analyzing the market system, means
of production, consumption, exchange, determinants of supply and demand, theories of
consumer behavior, basic economic theories and history of economics.
Course Learning Outcomes

At the end of the course, the pre-service teachers should be able to:
A. demonstrate knowledge of the market system, means of production, consumption, exchange,
determinants of supply and demand;
B. demonstrate understanding on the theories of consumer behavior, basic economic theories and
history of economics; and
C. apply critical and creative thinking through a survey of small-scale business/entrepreneurs on
the challenges encountered.
Grading System
Class Standing (CS) 70%

Quizzes (Q) 30%
Seatworks (SW) 20%
Homeworks (HW) 10%
Character/ Attendance (CA) 10%
Major Examination (ME) 30%
Midterm and Final Exam
TOTAL 100%
Exclusive_for_Gordon_College_Use_Only_Not_for_Sale
City of Olongapo
GORDON COLLEGE
Telefax No.: (047) 602-7175 loc 322
DETAILED LEARNING MODULE
Title: Introduction to Economics

Module No. 01
I. Introduction
This module is about understanding basic concepts and principles as an introduction
to the course Economics.
Learning Objectives
After studying this module, you should be able to:
- develop a basic understanding of economic concepts and principles

- apply these concepts and principles to practical situations
- appreciate and realize the importance of Economics in your daily life
II. Topics and Key Concepts
A. Definitions of Economics
The word 'economics' comes from two Greek words, 'eco' meaning home and 'nomos'
meaning accounts. And from this etymology, the English word economics would mean home or
household management.
Simply put, Economics is a social science that deals with the study of proper allocation
of scarce resources to satisfy the unlimited human wants and needs.
Let’s examine the concepts within the definition and how they are related with each
other. Scarcity is said to be the main reason for us to study Economics. Because our resources
are scarce or limited, we have to allocate them properly. And for us to allocate these resources
properly, we have to consider our choices or other available alternatives. In making our choices,
we have to consider both our needs and wants. But what’s the difference between a need and a
want? Most of the time, a lot of us get confused with these two. A need is something that we
cannot live without. Anything you could think of that you cannot live without it, it means that
thing is a need for you. On the other hand, a want is something that we can live without but we
still use or opt to have for convenience or comfort.
So, Economics is also about decision-making. Every day we have to choose among the
available choices or options and in every decision that we make, we have to forgo something.
That something is the opportunity cost or the value of what you have to give up in order to
choose something else.
City of Olongapo
GORDON COLLEGE
Telefax No.: (047) 602-7175 loc 322
B. Brief History
1.Classical Economics (mid 1700s – 1800s)
a. Adam Smith – “Father of Economics”, Wealth of Nations “ the bible in
economics”
b. John Stuart Mill - Principles of Political Economy
c. David Ricardo - theory on wages and profit, labor theory of value, theory of
comparative advantage, and theory of rents
d. Karl Marx – Das Kapital
2. Neoclassical Economics (1870s)
a. Leon Walras - developed the idea of marginal utility and the general
equilibrium theory
b. Alfred Marshall - Principles of Economics, first to develop the standard supply
and demand graph
c. John Maynard Keynes – “Father of Modern Economics” , The General Theory
of Employment, Interest and Money
3. Non-Walrasian Economics (1939)
a. John Hicks – investment-savings (IS)-(liquidity preference-money supply) LM
model
4 Post- Keynesian Economics
a. Paul Samuelson - Foundations of Economic Analysis, first American to receive
the Nobel Prize in economics
b. James Tobin - studied the relationships between the financial market and
macroeconomics; developed the portfolio selection theory and
proposed tax currency exchange transactions
c. Kenneth Arrow – contributed to the study of general equilibrium analysis and
welfare economics
C. Division of Economics
1. Macroeconomics is a branch of economics dealing with the performance, structure,
behavior, and decision-making of an economy as a whole. It focuses on the aggregate changes in
the economy such as unemployment, growth rate, gross domestic product and inflation. This
includes regional, national, and global economies.
2. Microeconomics is the study of individuals, households and firms' behavior in decision
making and allocation of resources. It generally applies to markets of goods and services and
deals with individual and economic issues.
City of Olongapo
GORDON COLLEGE
Telefax No.: (047) 602-7175 loc 322
D. Methods of Economics
1. Positive economics is a stream of economics that focuses on the description,
quantification, and explanation of economic developments, expectations, and associated
phenomena. It relies on objective data analysis, relevant facts, and associated figures. It attempts
to establish any cause-and-effect relationships or behavioral associations which can help
ascertain and test the development of economics theories.
Positive economics is objective and fact-based where the statements are precise,
descriptive, and clearly measurable. These statements can be measured against tangible evidence
or historical instances. There are no instances of approval-disapproval in positive economics.
Here's an example of a positive economic statement: "Government-provided healthcare
increases public expenditures." This statement is fact-based and has no value judgment attached
to it. Its validity can be proven (or disproven) by studying healthcare spending where
governments provide healthcare.
2. Normative economics focuses on the ideological, opinion-oriented, prescriptive, value
judgments, and "what should be" statements aimed toward economic development, investment
projects, and scenarios. Its goal is to summarize people's desirability (or the lack thereof) to
various economic developments, situations, and programs by asking or quoting what should
happen or what ought to be.
Normative economics is subjective and value-based, originating from personal
perspectives, feelings, or opinions involved in the decision-making process. Normative
economics statements are rigid and prescriptive in nature. They often sound political or
authoritarian, which is why this economic branch is also called "what should be" or "what
ought to be" economics.
An example of a normative economic statement is: "The government should provide basic
healthcare to all citizens." As you can deduce from this statement, it is value-based, rooted in
personal perspective, and satisfies the requirement of what "should" be.
When economists attempt to explain the world as it is, they act as scientist. When they
attempt to improve the world, they act as policy advisors. Correspondingly, positive statements
describe the world as it is, while normative statements prescribe how the world should be.
E. Importance of Studying Economics
1. To understand the global affairs
2. To understand the society
3. To be an informed voter
City of Olongapo
GORDON COLLEGE
Telefax No.: (047) 602-7175 loc 322
III. Teaching and Learning Materials and Resources

Google Meet
Online Resources
Lecture Notes
IV. Learning Task

1. Write an essay about the following. 20 points
A. Your personal experience regarding scarcity. What caused this problem and how did you
address it?
B. What was the most significant opportunity cost you have incurred in your life? What have
you learned from the situation?
2. Worksheet #1
List 10 of your belongings in Column A. Classify them as to NEED or WANT by putting a
check mark in the appropriate column (B or C). Make an explanation for your
classification in Column D. 20 points
A B C D
Belongings Need Want Explanations
1
2
3
4
5
6
7
8
9
10
Reference:
Feliciano R. Fajardo (1995) 3rd Edition: Economics
https://books.google.com.ph/books?
id=4FXPwafvP84C&printsec=frontcover&source=gbs_ge_summary_r&cad=0#v=onepage&
q&f=false
https://www.investopedia.com/

AS BAC ELEC 3 Module 1

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Republic of the Philippines

Class Code : 35690

Course Learning Outcomes

Class Standing (CS) 70%

DETAILED LEARNING MODULE

Title: Introduction to Economics

- develop a basic understanding of economic concepts and principles

II. Topics and Key Concepts

III. Teaching and Learning Materials and Resources

IV. Learning Task

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