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Nov 13, 2023
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Module 5: Applications of Supply and Demand THE DIFFERENT MARKET STRUCTURES 1. The degree of competition is driven by the numbers of competing firms in the industry. 2. The number of firms pertains to the actual number of competitors in the market. 3. The bargaining power of consumers refers to the ability of consumers to influence market prices. 4. A barrier to entry refers to the ease with which new firms can penetrate the industry. Perfect competition - firms selling homogenous or identical goods and many buyers who have access to the good. Monopolistic Competition - closer to what occurs in reality and also features many sellers but the sellers but the sellers typically have less capability and are smaller in size, Oligopoly - having few players in the industry Monopoly - has a single player that controls the market Labor force - total number of people identified as employed and unemployed Employed - individuals who have a job in either full-time or part-time capacity Unemployed - searching for a job, temporarily laid off, or those who are about to start a new job. Population Growth - increase in the total number of human beings in the country. Labor Force participation rate = Labor force X 100 Working age Population Unemployment and Wages The unemployment rate measures that percentage of individuals in the labor force who do not have a job. Unemployment rate = Unemployment X 100 Labor Force
4 types of unemployment that are considered in deriving the value of the numerator 1. Frictional unemployment - temporary unemployment that is a result of people being in between jobs or being transition 2. Structural unemployment - type of unemployment that results of people being in between upgrades that requires specialized skills 3. Cyclical unemployment - caused by the upturn and downturn in the business cycle 4. Seasonal unemployment - happens in industries with peak and lean seasons Labor Migration Overseas Filipino Workers (OFWs) The Philippine Financial Market - a marketplace for the exchange of financial securities such as stocks and bonds. Stocks - ownership in a company Bonds - these debts are largely traded over-the-counter or privately through investments brokers MONEY AND SUPPLY AND THE CENTRAL BANK 3 functions of money in economic context 1. Medium of exchange -form of payment for purchases and transactions 2. Unit of account - money is used as standard to measure the value of goods and services 3. Store of value - you can choose to keep your money now and save it for the future Liquidity - ease of use of an asset to pay for transactions Three tools conventionally employed by the BSP in achieving a desired level of money supply 1. Bank Rate - this is the central bank's lending rate to commercial banks 2. Open market operations - buying and selling of bonds by the central bank 3. Reserve requirement ratio - required to maintain a minimum cash reserve with central bank
Module 6: Contemporary Economic Issues Facing the Filipino Entrepreneur Entrepreneur - innovators Disruptive Innovations - changes the structure of an existing market. The Filipino Entrepreneur - Filipinos can be very enterprising Governance and Support - The department of Trade and Industry (DTI) governs entrepreneur Republic Act No. 10679 - Youth Entrepreneurship Act TYPES OF BUSINESS STRUCTURES 1. Sole Proprietorship - single owner 2. Partnership - more than one owner 3. Corporations - the owner and the business are considered as separate entities NEW BUSINESS REGISTRATION 1. DTI - Register business name 2. Barangay - secure barangay clearance 3. Municipality - get a business permit 4. BIR (Bureau of Internal Revenue) - apply for tax identification number 5. SSS (Social Security System) - apply as a self-employed owner Issues and Challenges Facing the Filipino Entrepreneur 1. Investment, Interest, and Financing Interest is the cost of borrowing ; Consumers borrow from banks to finance spending investments Two sources of financing: use one's fund & external financing 2. Rent - business require a physical store 3. Minimum Wage - drives up a business' operating expense 4. Taxes - higher income of tax means less disposable income available Common business taxes paid 1. Percentage tax - paid by entities that are exempt from VAT 2. VAT - tax on sale 3. Capital gains tax - imposed on the sale of assets 4. Income tax - most common task filed by employed
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