KING, ALEXIS O.

BSA 2C
TF 10:30-12:00

ACTIVITY 1
Recall the eight goals of economics, which among these goals are made for
economic policies? Explain your answer?
Economic security refers to a feeling of freedom and safety. The people of
a country feel themselves safe no matter wherever they are in their homeland. It
is the responsibility of the government of a country to provide security of life and
belongings of their people. That is why government establishes defense including
police for the protection and security of the natives. Economic security or
financial security is the condition of having stable income or other resources to
support a standard of living now and in the foreseeable future. It includes
probable continued solvency, predictability of the future cash flow of a person or
other economic entity, such as a country and employment security or job
security. Financial security more often refers to individual and family money
management and savings. Economic security tends to include the broader effect
of a society's production levels and monetary support for non-working citizens.
For me it is the economic security that is made for economic policies.
Because economic security refers to a feeling of freedom and safety. The people
of a country feel themselves safe no matter wherever they are in their homeland.
And a good economic policy should be people-oriented. The welfare of the
people is always the primary consideration. Some former poor nations became
progressive because their policies have been focused on the improvement of the
quality of life of the masses.

ACTIVITY 2
Explain the nature of the economic policies.

Economic policy is based on economic theory or principle. It is the

applications of a theory or principle. Are formulated to attain specific objectives or
solve certain problems. Many policy makers are politicians or top government
officials who have been elected by the people.
Economic policies are as good as their makers. If the policy makers are
only after about their own personal interest, then their policies will have adverse
effects on the sector of the economy.

Comment on our own economic policies.

 In our country which is the Philippines, the main program of the
government is to improve the quality of life of the people. In fact Dr. Placido
Mapa, Jr., former Minister of economic planning said:
“Man has always been the focus of all development efforts hence, the
ultimate goal of all development activities is to improve the people’s quality of life.
This brings us to a point that of haring the fruits of development. And this goal
can only be achieved by pursuing national development policies for various
regions, through with the government hopes to redress income disparities
caused by growth imbalances ”
But it is not always what you said that matters. It is the output or result.
Some economic policies are not given that high level of priority. Our economic
growth has a lot to be improved. And the policy makers must focus on the
‘people-oriented’ policy. Since all of those policies are concerned primarily by the
people.

Give some features of a good economic policies. Explain one.

One of the features of a good economic policy is that it must be long
range, but flexible to a certain degree. An economic policy must be long range; it
means that it must have a wider scope in order for it to be effective. But it must
also be flexible to a certain degree. It only means that a good economic policy
can be revised or improved if ever a certain situation occur. All in all, a good
economic policy must be adaptable and its main goal should always be for the
betterment of all.

Define Monetary policy. What are the monetary goals of the Bangko Sentral na
Pilipinas?

Monetary policy is an instruments used by the BSP to ease and tighten

credit in the economy thus promote price stability and increase or reduce liquidity
in the financial system.
The primary objective of BSP’s monetary policy is to promote a low and
stable inflation conductive to a balanced and sustainable economic growth. The
adoption of inflation targeting framework for monetary policy in January 2002 is
aimed at achieving this objective.

Explain the nature of fiscal policy?

Fiscal policy is commonly looked upon as comprising those variations in
government tax and expenditure programs which are undertaken with the
express purpose of securing the goals of macro-economic policy. It is therefore
but one aspect of the system of public finance and does not include measures
which are undertaken for reasons of allocative efficiency or which reflect a
concern with the distribution of income. Since changes in tax and expenditure
policies often imply a change in the size of the national debt, variations in debt
 policy are often included under the general heading of fiscal policy. Whilst we
refer briefly to the choice between taxation and debt in the financing of any given
expenditure programs, we consider debt management policy — by which we
mean changes in the composition of a given debt — to be an entirely separate
and distinct policy question and one beyond the scope of our current concern.
The debt referred to above should be understood in its commonly accepted
sense as consisting of bonds and securities issued by the government.

State the effects of fiscal policy in the economy, how are these related to
economic development?
2. economic development?

The effect of fiscal policy depends on the current state of the economy of a
specific country. Whenever the economy seems to be overheating or growing too
fast, the government may decrease spending. This will result to the decrease in the
overall demand in the economy.
Fiscal policy involves taxes. The decreasing tax tends to stimulate economic
growth. If people will pay less tax, they will have more money on hand which they
can either spend or save. If there is an increase in spending there is also an
increase in demand and so the production should also increase.
Explain how the categories of the supply-side policy may improve the inflation
rate, employment rate, economic growth and the balanced of payment of the
country.

Supply-side policy designed to increase LONG-RUN AGGREGATE

SUPPLY (LRAS), also known as the full employment level of output. It will focus
on improving the structural long term performance/competitiveness of an
economy and improve the production potential/capacity. The aims of the policies
are to positively affect the production side of the economy by improving the
institutional framework and the capacity to produce.

Employment rate Supply-side policies can contribute to reducing

structural, frictional and real wage unemployment and therefore help reduce the
natural rate of unemployment.
Economic growth Supply-side policies will increase the sustainable rate
of economic growth by increasing Long Run aggregating supply (LRAS); this
enables a higher rate of economic growth without causing inflation.
Balance of payment By making firms more productive and competitive,
they will be able to export more. This is important in light of the increased
competition from an increasingly globalised marketplace.