Do you agree with the saying “Money is

the root of all evil”? Why?

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Enumerating
Economic
Institutions and its
Impact in Society
What comes in your mind when you
hear the word economics?

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Economics
▸ - from the Greek term oikos, meaning "house"
and nomos, meaning custom/law, etymologically
speaking economics means "rules of the house”. It is the
science that deals with the factors that determine the
production, distribution and consumption of goods and
services. An economic system must define what to
produce, how to produce it and for whom to produced it.

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▸ Economic institution -​company or an ​
organization that ​deals with ​money or with ​
managing the ​distribution of ​money, ​goods, and ​
services in an ​economy. It is also well-
established arrangements and structures that are
part of the culture or society.

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▸ The world’s economic systems fall into one of four main
categories: traditional economy, market economy,
command economy and mixed economy; however, there
are unlimited variations of each type.

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▸ World Bank
▸ It is a dependent entity of the United Nations
Organization and works to provide economic and
financial support to countries that are in scenarios of
economic crisis.

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▸ World Trade Organization
▸ It is is for the economy to have impressive growth.

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▸  Companies
▸ The companies aim to participate freely in the
production of goods and services, to meet the demands
and needs.

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THE FOUR MAIN
ECONOMIC SYSTEMS
TRADITIONAL MARKET
ECONOMY ECONOMY

COMMAND MIXED
ECONOMY ECONOMY
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Traditional Economy
▸ In a traditional economy, goods and services are based
and produced by traditions and customs. These types of
economies tend to consume most of what they produce
(production mainly by hand) and sell or trade the rest.
This type of economy will often evolve into another type
of economy once the nation or country has developed.
▸  

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Market Economy
▸ In a market economy, the resources are owned and controlled
by the people of the economy. Market economies are based
on consumers and their buying decisions rather than under
government control. Market trends and product popularity
generate what businesses produce. The producers choose
how to make products based on the most economically sound
decision: that might mean machine labor to save costs or
human labor for specific skills.

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Command Economy
▸ In a command economy, the government controls all
economic activity. One example of a command economy
is communism. In a government-directed economy, the
market plays little to no role in production decisions.
Command economies are less flexible than market
economies and react slower to changes in consumer
purchasing patterns and fluctuations in supply and
demand.

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 Mixed Economy
▸ A mixed economy combines qualities of market and command
systems into one. In many countries where neither the
government nor the business entities can maintain the economy
alone, both sectors are integral to economic success. Certain
resources are allocated through the market and others through
the state. Theoretically, this system should be able to combine
the best policies of both systems, but in practice the proportion
government controls and response to market forces varies.

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The Different
Economic
Processes
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Reciprocity
▸ - When you give something away,you expect something
in return. This economic process entails the exchange of
commodities between parties, often on an individual
basis.

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Transfers
▸ - When resources from an individual or organization are
given to one another with no expectation of return, an
economic transfer is in place. This type of economic
process allows for the redistribution of resources within
an economic system.

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Redistribution
▸ - When the resources of one, several individuals, or
groups are collected and distributed proportionally or
equally to participating members.

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Market Transactions-
▸ Market is referred to as the exchange of goods and
services that involves buying and selling processes.
However, it is not a simple process of exchanging
materials, goods, and services. It involves several
elements and transactions. Market is about making
money, capital, income and growth.

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Interpret the illustration

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▸ The illustration above shows how economics work in everyday life of every
person. With or without our knowledge economics takes place. Each person
plays an important role in how an economic process takes place. The people in
the house busy and sells in exchange of a certain good that they can have from a
particular business establishment then the government sees to it that laws and
regulations are applied correctly so that every individual is given equal access
and opportunity when it comes to exchanging goods and products. It is a circular
process that happens every day.

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guess the jumbled letters to form an
economic word.
▸ 1. NIECNVITE- something that motivates an individual to
perform an action.
▸ 2. ABROL - this is considered as one of the economic
resources in production.
▸ 3. ARTEKM- the exchange of goods and services that involves
buying and selling processes.
▸ 4. MOCEPITNOTI- this is a situation where the sellers do
rivalry with other sellers in the market.
▸ 5.MOCEPITNOTI- this is a situation where the sellers do
rivalry with other sellers in the market. 29