Nature and Scope of

Economics

By Engr. Ma. Nerissa P. Sangalang, RCE,LPT,MBA

 Objectives

• To help the students understand the basic concepts

of Economics from a wide variety of angles
particularly on how people get the things they want
and need and how these things are distributed, and
to help them making sound decisions at individual
and business levels
• To assist the students in applying that
understanding. to contemporary economics issues,
depict demand graphs, analyze supply issues, and
understand the correlation between business costs,
pricing and profit.
09/03/2020 Microeconomics module by Engr. N. Sangalang 2
ECONOMICS AS
A FIELD OF STUDY
 Economics

• Derived from the Greek word

“oikonomia” or “oikonomos”
• Oiko meaning household
• Nomia/Nomos meaning management
• Economics = Household Management

09/03/2020 Microeconomics module by Engr. N. Sangalang 4

 Economics is a branch of
social science that deals
with efficient allocation of
scarce resources for the
satisfaction of unlimited
human needs and wants.
 Economics

Social Science
• uses a scientific approach to study
human behavior
• considered as the queen of the social
sciences
• utilizes mathematical method
– specificity, accuracy, and precision
09/03/2020 Microeconomics module by Engr. N. Sangalang 6
 Economics

Efficient Allocation of Scarce Resources

• this is the primary and most important
reason for studying economics
• resources are used to produce good and
services but these are not unlimited
• It is important that these resources are
used efficiently to create the most
benefit to society
09/03/2020 Microeconomics module by Engr. N. Sangalang 7
 Economics

Unlimited Needs and Wants

when will our needs and wants be unlimited?
5 Basic Needs
1. Food +Education
2. Shelter +Load
3. Clothing +Gadgets
4. Water +Internet
5. Love and Care +Transportation

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 Economics

Unlimited Needs and Wants

Why are our needs and wants unlimited?
Because of…
• Technological Breakthroughs
• Ads and Commercials – demonstration
effect
• Production – from raw materials to final
goods
09/03/2020 Microeconomics module by Engr. N. Sangalang 9
END