ECONOMIC
INSTITUTIONS
📎refers to any intitution that is a player in an
economy.
📎is an establishment whose activities have a
bearing on society whether these institutions
are business or not.
Categories of economic
institutions
Manufacturers
Distributors
Consumers
MICROECONOMICS
📎is concerned with the specific
economic units of parts that make an
economic system and the relationship
between those parts.
📎empahsis is placed on understanding
the behavior of individual firms,
industries, households, and ways in
which such entries interact.
MACROECONOMICS
📎is concerned with the economy as a
whole, as large segments of it.
📎focuses on such problems asas the
role of unemployment, the changing
level of prices, the nation's total
output of goods and services, and the
way in which government raises and
spends money.
3 Basic economic
problems
First, what goods and services to
produce and how much.
🔹In business, a feasibility study
determines whether certain goods or
services becomes profitable or not in a
given market.
🔹Investors are only willing to produce
goods and services which will give
them good profit.
Second, how to produce goods and
sservices
🔹This is a problem of production
technology or methods of production.
🔹As a general rule, goods and services
must must be produced in the most
efficient manner.
🔹This means minimum input without
sacrificing quality.
Third, for whom are the goods and
services.
🔹This is the problem of distribution.
🔹Who gets the goods like rice, clothes,
shoes, books, and the services such as
education, health services, and other
social services.
🔹In most countries, those who have
more money acquire more goods and
services than the poor.
GOVERNMENT
as a Social
Institution
Government
• Is an institution entrusted with making
and enforcing the rules of society as
well as regulating relations with other
societies.
• The institution which resolves conflicts
that are public in nature and involve
more than a few people.
3 Branches of
Government
The EXECUTIVE branch
The LEGISLATIVE branch
The JUDICIAL branch