Applied Economics

Quarter 1 – Module 1:
Differentiate Economics As Social
Science and Applied Science In Terms
of Nature And Scope
(Week 1)

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 What I Need to Know

This module was designed and written with you in mind. It is here to help you
master the difference between social science and applied science. The scope of this
module permits it to be used in many different learning situations. The language
used recognizes the diverse vocabulary level of students. The lessons are arranged
to follow the standard sequence of the course. But the order in which you read them
can be changed to correspond with the textbook you are now using.

The module has one lesson only, namely:

Lesson 1: Differentiate economics as social science and applied science in

terms of nature and scope

After going through this module, you are expected to:

1. define economics as social science and as an applied science; and
2. differentiate economics as social science and applied science in terms of
nature and scope.

What I Know

In this part of the module, the teacher would like to know your level of
understanding about the lesson. If your score is 15 points, you can skip the lesson
but if you got 14 points and below, continue answering the module.

Read each question very carefully. Write the correct answer on a separate sheet of
paper.

1. It is a condition where there are insufficient resources to satisfy all the needs and
wants of a population.
A. shortage B. scarcity C. surplus D. equilibrium
2. It refers to the value of the best forgone alternative.
A. trade-off B. choice C. opportunity cost D. decision making
3. It is also known as factors of production, where the resources are used to produce
goods and services. These resources are, by nature, limited and therefore, command
a payment that becomes the income of the resource owner.
A. economic resources C. political resources
B. environmental resources D. industrial resources
4. It refers to physical and human effort exerted in production. It covers manual
workers like construction workers, machine operators, and production workers, as
well as professionals.
A. land B. labor C. capital D. entrepreneurship

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5. Which of the following does not belong to the group?
A. land B. labor C. capital D. credit
6. It involves the use of scarce resource to satisfy the unlimited needs and wants of
human
A. Economics C. Applied Economics
B. Social Science D. economic model
7. It refers to the study of society and how people behave and influence the world
around them.
A. Economics C. Applied Economics
B.Social Science D. economic model
8. A situation in which humans have to choose between two things that cannot be
had at the same time is called _________________.
A. opportunity cost C. trade off
B. exchange D. trading
9.It is the application of economic theory and econometrics in specific settings with
the goal of analysing potential outcomes.
A. Applied Economics C. Social Economics
B. economic model D. economic theory
10. All societies are faced with basic questions in the economy that have to be
answered in order to cope with constraints and limitations.
A. true B. false
11. It refers to the application of mathematics and statistics to the study of economic
and financial data.
A. economic model C. Economics
B. econometrics D. economic theory
12. It can be described as the study of the various modes and aspects of human
interactions in a group as these people aspire to preserve their group as a social unit,
to make it stable and to promote its growth, expansion and development.
A. Social Science C. Social Economics
B. Applied Science D. Applied Economics
13. It is the formulation of general theories through testing and historical data of
the phenomena.
A. Economics C. Econometrics
B. Applied Science D. Social Science
14. It refers to natural resources or sometimes called “free gifts of nature”.
A. land C. capital
B. labor D. entrepreneurship
15. Economic theory is all about ideas, theories and models. Applied Economics is
the application of economics theories, practices and models to real life situation.
A. Both statements are true.
B. Both statements are false
C. First statement is true; second statement is false.
D. First statement is false; second statement is true.

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 Lesson Differentiate Economics as Social

1 Science and Applied Science in Terms

of Nature and Scope

They say you only know the value of something once it is gone. Let us see if
this also applies in Economics. Let us discover in this module the extent of its value
to people and to the country.

What’s In

In this part, the teacher provides an activity to help student remembered

their past or previous lesson.

Notes to the Teacher

The teacher should encourage the learners to re-read their old notes
in Economics 9, this will help them to easily understand the lesson.

Maybe we are not aware but everything we do involves Economics- the art of
decision making. In making decision, we always consider the trade off and
opportunity cost given. For example, when you go to Senior High School, you choose
one fromthe following strands: Accountancy Business and Management (ABM)
General Academic Strand (GAS), Humanities and Social Sciences (HUMSS); and,
Science and Technology Engineering and Mathematics (STEM). Before you make
decision regarding the matter, you will first assess yourself. After assessing yourself,
then that’s the time you will decide. The moment you made decision on what strand
you will is already Economics.

Let us check if you still remember the following terms that you encountered in
Economics 9. Find the given words in the Word Search and define each word.
1. scarcity 11. microeconomics
2. shortage 12. macroeconomics
3. relative scarcity 13. traditional economy
4. absolute scarcity 14. command economy
5. opportunity cost 15. mixed economy
6. trade off 16. Market economy
7. land 17. GNP
8. labor 18. GDP
9. capital 19. needs
10. entrepreneurship 20. Wants

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 T R A D I T I O N A L E C O N O M Y E S M M
G N P N E E D S E G A T R O H S S H S E I A
S T N A W K M A C R O E C O N O M I C S X R
K A P L E R C O M M A N D E C O N O M Y E K
E D A M C A P I T A L T R A D E O F F L D E
L A B O R M S C A R C I T Y V I R U S E E T
G M I C R O E C O N O M I C S C O V I D C E
P I H S R U E N E R P E R T N E C H G S O C
P O S I T I V E E C O N O M I C S H D E N O
N O R M A T I V E E C O N O M I C S P O O N
G D Y T I C R A C S E V I T A L E R O O M O
A B S O L U T E S C A R C I T Y M O N E Y M
O P P O R T U N I T Y C O S T R A D I N G Y

Since you are already familiar with the basic terms in Economics, let us now start
our lesson.

What’s New
In this part of the module, the teacher presents the new lesson to the
learner.

Did you know that organizing is very important? It makes our life easier and our
things in order. This time, let us help Juan to classify the given words and put
them in the correct table.

scarcity theories
diagrams economic model

econometrics equations
decision-making economic resources
economic theory behaviour of individuals and of society

Economics as a Social Science Economics asan Applied Science

1 1
2 2
3 3
4 4
5 5
Based on answer, give the meaning of social science and applied science.

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 What is It

In this part, the teacher provides brief discussion about the

lesson. It aim to discover and develop new skills to learner.

Behavior Diagram

Scarcity Economic
model

Equation

Social Applied
ECONOMICS
Science Science
as
Economic
Decision Making Theory
(Opportunity cost
and Trade Off)

Economic Resources
(land, labor, capital Theories
and Econometrics
entrepreneurship)

As a consumer, are you satisfied with what you have at the present? Most
probably the answer is “NO.” Why? This is because people have unlimited needs and
wants, but we only have limited resources to satisfy them all.

Economics is the allocation and use of scarce resources to satisfy the

unlimited needs and wants of human.

What is the difference of social science and applied science?

Economics, as a social science, studies how individuals make choices in

allocating scarce resources to satisfy their unlimited wants.

For example, Maria is a Senior High School Student at Mayap High School.
Her daily allowance is P50.00 covering her meals and other school expenses. In order
for her to pay her school project, she has to give up (skip) her lunch (opportunity
cost). In this scenario, three things can be derived and proved that Economics is a
social science and these arescarcity, trade-off and opportunity cost.

Economics as an applied (economics/science) is the application of

economic theory and econometrics in specific settings with the goal of
analyzing potential outcomes.

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 For example, a student received bigger allowance; does it mean her spending
behavior also changes? The prediction will be, “Yes, once a person has more money,
she intends to buy more”. Check the prediction using economic theories/models like
The Law of Demand and Supply.

Another tool used by economist is econometrics which is the application of

statistical and mathematical theories for the purpose of testing hypothesis and
predicting future outcome.

Contribution in the Economy

Both are important tools in assessing the economy of the country.
As a social science, it needs to prove the theory while in applied science, it
seeks a solution to the phenomena. They may be using different approaches
or procedure but they have the same purpose, and that is how to help the
country maximize its limited resources to satisfy all the needs and wants
of the population.

What’s More
The teacher would like to solidify your understanding about the topic
being discussed.

Activity 1
Read each question very carefully. Arrange the jumbled letters to get the
correct answer.

1. insufficient natural resources ------ C R T Y S I C A

2. statistical and mathematical theories ----- CSTMNOIOCERE

3. free gifts of nature ----- DLAN

4. trying things out ----- DEECSALPOOMPINCI

5. the brain of economic resources ----- PEINHTSRREUPERNE

Activity 2

Read each statement carefully. Write SS if it refers to Social Science and AS if

it is about Applied Science.

1. It is the study of observing how theories work in real situations.

2. It reveals the true situation to come up with actual solutions
3. It studies the behaviour of people towards products and services.
4. It is described as the study of the various modes and aspects of human
interactions in a group.

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5. It is a popular tool in business planning and for assessment, analysis and
evaluation of government policy.
Activity 3

Read each item very carefully. Find the corresponding answer in the Word
Bank

Land labor economics econometrics applied science credit

macroeconomics social science capital entrepreneurship

microeconomics

1. human skills:___________________________
2. fossil fuels:_____________________________
3. assets/money:__________________________
4. human behavior:________________________
5. testing hypothesis:______________________

What I Have Learned

In this part of the module, the teacher would like to know what you have
learned in the lesson.

Using Venn Diagram, list down all the similarities and differences of Economics as
Social Science and as an Applied Science

What I Can Do
In this part of the module, the teacher would like to know how you can apply
the lesson in real life situation.

Talk to the person who prepares the household budget and make a list of all the
basic expenses for one month and answer the following questions:
1. What is your reaction regarding the outcome of the interview?

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2. How can you help your family improve your standard of living?

Assessment

Modified True or False. Write the word True is the statement is correct; if False,
underlined the word/s that make the statement incorrect and write the correct
answer in the space provided before the number

__________1. Economics is a social science because it studies human behavior.

__________2. Economics is an applied science because it studies how people behave
and influence the world around them.

__________3. Economics is a social science that studies how individuals make choices in
allocating scarce resources to satisfy their unlimited wants.
__________4. Scarcity is the reason why people have to practice economics.

__________5. Trade-off is used to test the hypothesis.

__________6. Social science can assess the sales of a certain company.

__________7. Applied economics deals with the application of economic theories and
principles in predicting the future outcome.
__________8. Applied economics is only practiced at macroeconomic and
microeconomic level.

__________9. Social Science is Problem Solving while Applied Science is to Theory

Prove.

__________10.Social science is about scientific knowledge and how to practice it in

real life.

Additional Activities

In this part, the teacher provides another activity to enrich the knowledge or skill
of the learner about the lesson.

Cite an economic activity in the country and relate it to social science and
applied science.

*1 Essay of an economic activity related Social Science (25 points) - 50 words

minimum

*1 Essay of an economic activity related Applied Science (25 points) - 50 words

minimum

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*See Rubrics Below

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