Learning Area APPLIED ECONOMICS Grade Level 12

W2 Quarter Third (3 ) Quarter

rd Date March 8-12, 2021

I. LESSON TITLE Utility and Application of Applied Economics to

Solve Economic Issues and Problem
II. MOST ESSENTIAL LEARNING COMPETENCIES (MELCs) Examine the utility and application of applied
economics to solve economic issues and
problems
ABM_AE12-Ia-d-
III. CONTENT/CORE CONTENT Economics as an applied science and its utility
in addressing the economic problems of the
country

Suggested
IV. LEARNING PHASES Timeframe
Learning Activities
A. Introduction 30 DAY 1
Panimula minutes Good day! Welcome to another week in this lesson
you will be able to:
1. identify the basic economic problems
2. illustrate how applied economics can be used to solve
economic problems
3. construct framework to solve the economic problem
4. solve problems on economic activities

In our last lesson, we discussed economics: its nature, scope and

two fields of study. We also covered the kinds of goods and the
economic resources to produce the goods. Let's have a review
of our past lesson.
Part I
Directions: Read and understand each question. Choose the
letter of the correct answer and write it on your notebook.

1. The physical effort of the manpower to produce the basic

needs of the consumers, describes which factor of production?
a) Land b) Capital c) Labor d) Entrepreneur
2. The initiative and creativity to produce something new
describes which factor of production?
a) Land b) Capital c) Labor d) Entrepreneur
3. The equipment of the coffee shop to produce cups of coffee,
are what kind of goods or products?
a) Consumer goods b) Either consumer goods or capital goods
c) Capital goods d) Economic goods
4. Which of the following best describes economics as a social
and an applied science?
a) The study of products we need to survive b) The study of
how customers make choices when there is unlimited supply of
resources
c) The study of human personalities d) The study of how buyers
make choices when there is limited supply
5. Which is a customers’ basic needs.
a) Water and shelter b) Iced tea c) Laptop and cellular
phones d) Expensive bags
Part II
Direction: Choose the Factors of Production described below.
Write the letter of the correct answer in your notebook.
A) Land C) Labor B) Capital D) Entrepreneurship
1. The idea for a car that runs on a rocky road
2. The crude oil used by ABM Firm to produce gasoline

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 3. The machine used by Mang Jose, a tailor to stitch PPEs
4. The manpower to build bridges and houses
5. Technicians who repair computers

B. Development 30 DAY 2
Pagpapaunlad minutes The Four Basic Economic Problems
In this topic, we will look into these basic problems of what to
produce, whom to produce, how to produce and what
provisions on production for economic growth.
Basic Economic Problems of the Country
What to Produce?
If there is scarcity of goods in a society, the firms have to make
wise decisions on what goods/service should be produced and
determine the quantity to be reproduced. For example, which
do we produce more, masks or canned goods? But we need
capital goods like machines, or consumer goods like laptops.
The society must decide the type and quantity of good/service
to be produced to meet the immediate needs of the society.
For whom to Produce?
The society would always consider the immediate beneficiary of
the goods. For example, when we produce masks and PPEs we
are supposed to produce first these for the frontliners of COVID
Pandemic fight. A society decides on the distribution of the
goods and services among the members of society who need
them the most.
How to Produce?
The production of goods or services needs effective methods
and processes. For example, you can produce PPEs using
sewing machines; sardines using aqua resources like fish and
land resources like tomatoes. The production requires more
labor and capital investment.
What provision/laws should be made for economic growth?
A society uses all its resources for current consumption. If a
society uses all its resources, then its production capacity will not
increase. The standard of living of the people and the income
of the workforce remains constant until the standard of living will
decline in the future. The society must also decide on the part of
the resources to be saved for future progress.

Applied Economics on basic Issues and problems

Applied Economics seeks to solve the problems of scarcity. This

happens when human wants for goods and services exceed
the available supply. In a modern economy, it is evident that a
division of labor happens when people earn income by
specializing in what they produce.
To deepen your understanding, answer the following activities.
Activity;
You read about a traveling situation in which some airline
passengers seem to get a “fast pass” through security and
move effortlessly through the boarding process, while other
passengers are waiting in long lines. In this example, the
travelers who are moving quickly through the boarding process
are probably:
a) VIP passengers waiting longer more in an inconvenient line
b) Passengers who value time and convenience and are willing
to pay additional fees for the privileges and other services
c) Loyal passengers whom they knew beforehand in which line
to go to avoid delays and inconveniences
d) Government officials who are seated in the executive area
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 What will be your reaction?

Activity 2.

Directions: Choose the letter of the correct answer and write it

in your notebook.

1. Scarcity of resources in your locality is evident. Only available

resources are fabrics, electric sewing machines and skilled
workers. The government said, you are only allowed to work
from home to be safe and free from infection of viruses. Which
items most likely you need to produce? a) PPEs b) Canned
goods c) Sacks of rice d) Sewing machines

2. The city needs urgent services of the medical front liners in

curing the increasing number of patients. There is scarcity in the
raw materials for production. To whom would you produce first
the available resources? a) Soldiers b) Police Officers
c) Medical Frontlines d) Your family

3. There is an urgent need for PPEs by the medical frontlines in

the Philippines due to the increasing number of COVID patients
every day. Which is not true of producing the products (PPEs)?
a. Import from China b. TESDA students and skilled workers may
produce the PPEs. c. Manufacturers/suppliers may supply the
PPEs. d. Export PPEs to Japan as gross national products

4. The ABM Manufacturing Company decides to produce more

liquid soap than bar soap to supply the growing demands in the
market. What economic problem will be given a solution? a.
Whom to produce b. How to produce c. How much incentive d.
What to produce

C. Engagement 15 Day 3
Pakikipagpalihan minutes Let us deepen your understanding by answering the following
activities by completing the sentences. Write the answer in your
notebook.
Among nations, these are the common economic problems on
production of goods and services: 1) ____________;
2) ____________; 3) ________________; 4) ______________.
Economics can be a tool to solve the fundamental problem in
economics which is 5). ________________ in the production of
goods and services.

The strategic solutions/decisions/options to economizing

problems include 6) __________; 7)_________; 8)_______________.
D. Assimilation 10 Let us have more exercises.
Paglalapat minutes Tell whether the following statements are correct or incorrect.
Write the answer in your notebook.

1. Scarcity in goods and services happens if the resources in the

production are inadequate or scarce.

2.Customers must choose among several alternatives if

scarcity exists.

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 3. Income inequality is the gap in income that exists between
the rich and the poor customers willing to buy the same
products.

4. Shortage of goods and services is an economic problem; and

shortages are always constant.

5. The Build Build Build Program by the government aims to help

improve the infrastructure projects and other programs of the
country.

V. ASSESSMENT 20 Day 4
(Learning Activity Sheets for minutes Scenario:
Enrichment, Remediation or
Assessment to be given on Weeks
Every society must make choices about which essential should
3 and 6) be allocated with the available but limited resources for
production. In most cases, where there is scarcity in the
production of necessities, or where there are no enough funds
to accomplish everything for the satisfaction of everyone, the
society has to make better choices. Today, we have to adjust
to the new normal way of living. There is scarcity in the
production of goods and services for everyone’s needs and
wants. Everything in this world has limitations. Rich and poor, all
individuals…” ceteres paribus….” “all else are equal” ….
Regardless of your economic status,

Which is more important to you, health or unlimited supply for

your wants? Explain your answer.

VI. REFLECTION 15 In your notebook write your personal insights about our lesson.
minutes
Economic Issues or problem can be solved by:

I realized that every problem

Prepared by: Renato L. Berosil Jr., SDO Checked by: Dr. Josephine P. Canlas, Adora G. Del Mundo,
Imus City Alfredo G. Buhain, Jr.