ABM

Quarter 1 – Module 9:
Explaining the Effects of the
Various Socio-Economic Factors
affecting Business and Industry
ABM- GRADE 12
Alternative Delivery Mode
Quarter 1 – Module 9: Explaining the Effects of the Various Socio-economic Factors
Affecting Business and Industry
First Edition, 2020

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 ABM
Quarter 1 – Module 9:
Explaining the Effects of the
Various Socio-Economic Factors
Affecting Business and Industry
Introductory Message
For the facilitator:

Welcome to the Applied Economics 12 Alternative Delivery Mode (ADM)

Module on Explaining the Effects of the Various Socio-Economic Factors affecting
Business and Industry.

This module was collaboratively designed, developed and reviewed by educators

both from public and private institutions to assist you, the teacher or facilitator in
helping the learners meet the standards set by the K to 12 Curriculum while
overcoming their personal, social, and economic constraints in schooling.

This learning resource hopes to engage the learners into guided and independent
learning activities at their own pace and time. Furthermore, this also aims to help
learners acquire the needed 21st century skills while taking into consideration
their needs and circumstances.

In addition to the material in the main text, you will also see this box in the body of
the module:

Notes to the Teacher

This contains helpful tips or strategies
that will help you in guiding the learners.

As a facilitator you are expected to orient the learners on how to use this module.
You also need to keep track of the learners' progress while allowing them to
manage their own learning. Furthermore, you are expected to encourage and assist
the learners as they do the tasks included in the module.

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For the learner:

Welcome to the ABM 12 Alternative Delivery Mode (ADM) Module on Understanding

Social-Economic and Socio-Economic Factors!

The hand is one of the most symbolized part of the human body. It is often used to
depict skill, action and purpose. Through our hands we may learn, create and
accomplish. Hence, the hand in this learning resource signifies that you as a
learner is capable and empowered to successfully achieve the relevant
competencies and skills at your own pace and time. Your academic success lies in
your own hands!

This module was designed to provide you with fun and meaningful opportunities
for guided and independent learning at your own pace and time. You will be
enabled to process the contents of the learning resource while being an active
learner.

This module has the following parts and corresponding icons:

What I Need to Know This will give you an idea of the skills or
competencies you are expected to learn in
the module.

What I Know This part includes an activity that aims to

check what you already know about the
lesson to take. If you get all the answers
correct (100%), you may decide to skip this
module.

What’s In This is a brief drill or review to help you link

the current lesson with the previous one.

What’s New In this portion, the new lesson will be

introduced to you in various ways such as a
story, a song, a poem, a problem opener, an
activity or a situation.

What is It This section provides a brief discussion of

the lesson. This aims to help you discover
and understand new concepts and skills.

What’s More This comprises activities for independent

practice to solidify your understanding and
skills of the topic. You may check the
answers to the exercises using the Answer
Key at the end of the module.

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 What I Have Learned This includes questions or blank
sentence/paragraph to be filled in to
process what you learned from the lesson.

What I Can Do This section provides an activity which will

help you transfer your new knowledge or
skill into real life situations or concerns.

Assessment This is a task which aims to evaluate your

level of mastery in achieving the learning
competency.

Additional Activities In this portion, another activity will be given

to you to enrich your knowledge or skill of
the lesson learned. This also tends retention
of learned concepts.

Answer Key This contains answers to all activities in the

module.

At the end of this module you will also find:

References This is a list of all sources used in

developing this module.

The following are some reminders in using this module:

1. Use the module with care. Do not put unnecessary mark/s on any part of
the module. Use a separate sheet of paper in answering the exercises.
2. Don’t forget to answer What I Know before moving on to the other activities
included in the module.
3. Read the instruction carefully before doing each task.
4. Observe honesty and integrity in doing the tasks and checking your
answers.
5. Finish the task at hand before proceeding to the next.
6. Return this module to your teacher/facilitator once you are through with it.
If you encounter any difficulty in answering the tasks in this module, do not
hesitate to consult your teacher or facilitator. Always bear in mind that you are
not alone.

We hope that through this material, you will experience meaningful learning
and gain deep understanding of the relevant competencies. You can do it!

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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 nature of Applied Economics. 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 is divided into two lessons, namely:

 Lesson 1 – Understanding Social-Economic and Socio-Economic Factors
 Lesson 2 – The effects of socio-economic factors affecting business and
industry

After going through this module, you are expected to:

1. Understand social- economic and socio-economic;
2. Explained the effects of various socio-economic factors on business and
industry

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 What I Know

Explain the following terms in your own understanding. Write your answers
on your answer sheet.

1. Consumer

2. Supplier

3. Investors

4. Capital

5. Income

6. Tax

7. Revenue

8. Services

9. Product

10.Economics

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 Lesson
Understanding Social-Economic and
1 Socio-Economic Factors

You have learned how to differentiate different terms used in economics in the past
lesson. Now, you will learn how to explain the effects of the various socio-economic
factors affecting business and industry.

What’s In

List down 10 factors (things, event, person or place) that you think can affect our

self, household, economy on venturing business. Write your answer on your sheet

of paper.

What’s New

Anna want to eat Kimchi but she can’t buy foods on the markets because of

the fear of this pandemic. At first, she doesn’t trust online sellers especially when

talking about food but because she craved for the food because of watching K-

dramas for a week and also, she can’t go outside because of the pandemic so she

decided to look on social media. While scrolling her Facebook, she has seen that

one of her friends sells kimchi online with free delivery near the area. So, she

messaged her friend and ordered her favorite food. In 15 minutes, her ordered food

delivered. She feels happy eating her favorite Kimchi without her going out.

How did the current situation change the behavior of Anna? Why did she

choose to find it online? How does the technology help her?

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 What is It

The first step to understanding what socioeconomic factors are is to

understand social economics. This is a specialized branch of economics that

concerns itself with studying the intimate relationship between economics and

social behavior. Such things as ethics, social norms and different social

philosophies have an impact on how consumers behave in an economy and the

eventual shape that economy will take. The study of social economics seeks to

predict what kind of results to expect when the society has been changed. It does

this by studying politics, history and other social sciences.

Socio-economic factors are primarily the PEST – POLITICAL, ECONOMIC,

SOCIAL, and TECHNOLOGICAL FACTORS, these are the main factors that affects

businesses an industry for the next lessons.

Mostly used business tool by organization is the PEST Analysis. It is to

discover, evaluate, organize, and track macro-economic factors which can impact

on their business now and in the future. The framework examines opportunities

and threats due to Political, Economic, Social and Technological forces.

Political. Political or politically motivated factors that could impact the

organization. It includes government policy, political stability or instability,

corruption, foreign trade policy, tax policy, funding grants and initiatives, etc.

Economic. Economic trends, growth rates, industry growth, seasonal factors,

international exchange rates, international trade, labor costs, unemployment rates,

taxation, inflation, interest rates, monetary policies, raw material cost, etc.

Social. Attitudes and beliefs about a range of factors including money,

customer service, imports, religion, cultural taboos, health, work, leisure, the

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environment; population growth and demographics, immigration/emigration, life

style trends, etc.

Technological. Technology and communications infrastructure, legislation

around technology, consumer access to technology, emerging technologies,

automation, research and innovation, technology incentives, etc.

These are the PEST analysis that provides an overview of all the crucial

external influences on the organization, supports more decisive and knowledgeable

decision making, helps evaluate how your strategy fits into the broader

environment and encourages strategic thinking, assists planning, marketing,

organizational change initiatives, business and project development, project

management and research papers.

As we are now in the “new normal” norm some of our goods and services can

be buy and sell through online platforms such as face book, Instagram, Twitter and

etc. Technology is major factor that affects our behavior as consumer. Some are

now having groups like Barter Community or online selling stuffs thru this money

are easily earned because of the numbers of prospect consumers online.

Most demanded services and/or products through online is selling of home-

cooked foods like “Kimchi” or “Kimbop” (Korean foods) because Filipinos now a days

are mostly a fan of Korean dramas thus this new product were in demand and also

with Korean fashions and beauty essentials.

Online sellers now are rapidly growing because consumers find it easy to

buy stuffs because of the free deliveries, free shipping fees or even decided to meet

up on agreed places. It is the most convenient way in exchanging services and

goods.

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 What’s More

Explain. Look and observe around you. Why do people now a days hooked-

up in online selling? How did it change their social behaviors? What factors of the

socio-economic been affected? Write your answers on your sheet of papers.

What I Have Learned

In understanding social – economic and socio-economic factors, I must:

 Define social - economic;

 Determine various socio-economic factors; and

 Define the different socio-economic factors.

1. Social Economic - a specialized branch of economics that concerns itself

with studying the intimate relationship between economics and social

behavior.

2. Various socio-economic factors are: Political, Economic, Social and

Technological factors, etc.

3. Different socio-economic factors:

Political Factor – includes government policy, political stability or

instability, corruption, foreign trade policy, tax policy, funding grants and

initiatives, etc.

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 Economic Factors – economic trends, growth rates, industry growth,

seasonal factors, international exchange rates, international trade, labor

costs, un-employment rates, inflation, etc.

Social factors – attitudes and beliefs about a range of factors including

money, costumer, services, religion, cultural taboos, health, work, leisure,

environment, population growth, lifestyle trends and etc.

Technological Factors – technology and communication infrastructure,

legislation around technology, consumer access to technology, emerging

technologies, automation, research and innovation, technology incentives,

etc.

What I Can Do

Observe and site an example on a present situation where socio-

economic factor affects a specific market or economy. Explain with 500

words.

Assessment

Explain the following. Write your answer in your piece of paper.

1. What government policies or political groups could be beneficial or

detrimental to our success?

2. What economic factors will affect us moving forward?

3. How do our customer’s belief and values influence their buying habits?

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 4. What technological advancements and innovations are available on the

horizon?

Additional Activities

Group yourselves into 5. Think of a scenario that explained the

factors of socio-economic then perform it. Record and send it thru email. It

should only be a maximum of 10 minutes.

Teacher’s email:

Group 1: Political Factor

Group 2: Economic Factor

Group 3: Social Factor

Group 4: Technological Factor

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 Answer Key

What I know

1. Consumer – a person who purchase goods and services for personal use

2. Supplier – a person or business that provides a product or service to

another entity

3. Investors – a person that allocates capital with the expectation of a future

financial return or to gain an advantage

4. Capital – a financial assets that can enhance one’s power to perform

economically useful work

5. Income – money received, especially on a regular basis for work or

through investments

6. Tax – a compulsory financial charge or some other type of levy imposed

upon a taxpayer by a governmental organization in order to fund

government spending and various public expenditures.

7. Revenue – income generated from normal business operations and

includes discounts and deduction for returned merchandise.

8. Services – a transaction in which no physical goods are transferred from

the seller to the buyer.

9. Product – an object or system made available for consumer use.

10.Economics – the branch of knowledge concerned with the production,

consumption and transfer of wealth.

What’s more: Essay

Assessment: Essay

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 Lesson The Effects of Socio-Economic

2 Factors Affecting Business and

Industry

What’s In

List down socio-economic factors that affects business in locality. Write your

answers on your answer sheet.

What’s New

Socioeconomic factors are, therefore, the social and economic factors that

shape and determine the dynamics a society will experience. These are factors that

affect the behavior of a particular group, also known as a socioeconomic class.

Perhaps the most interesting behavior of members of a socioeconomic class is their

behavior as consumers. Different socioeconomic classes will generally have

different priorities, and this will affect how they spend their money. Various socio-

economic factors that impacted business and industry are primarily the PEST –

POLITICAL, ECONOMY, SOCIAL, TECHNOLOGICAL FACTOR, these are the main

economic factors that affect a business.

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As we are now experiencing Pandemic because of this COVID-19, how does it affect

our health, income and social aspect of life? Write down your answer in a

paragraph form.

What is It

Understand the socioeconomic factors affecting business will help you make

better decisions about the future and direction of your business. To have an

intimate understanding, however, you will have to understand both external and

environmental factors, as well as how their interplay affects your business.

Environmental Analysis

This is a special term that refers to the process of looking at the external

socioeconomic issues in a business. It is considered a part of general business

analysis, so it is useful to the executives of a company. It can help them grow the

organization, increase the streams of revenue the company receives and also get

ahead of competitors.

Socioeconomic Factors that may affect Businesses and Industry

Economic factors are an essential part of all business analysis, no matter whether

it is PEST analysis, PESTLE analysis, or any other kind of business analysis. These

are the main factors considered when a company makes financial decisions.

These factors are connected to money, goods and services. They affect businesses

on a micro-level, but they are a lot more powerful than that – they also affect the

entire economy on a macro-level. The economy, whether a local economy or a global

one, will pretty much be the determining factor in the details associated with the

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operation of a company, such as the value of its assets, consumer demand and

even taxes.

Some economic factors you must think about in your business include exchange

rates, interest rates, recession, inflation, taxes, and demand and supply. Here is a

closer look into three of these factors and their connection to businesses.

Interest Rates

Interest rates are everywhere, and are imposed by many different people. In fact,

banking institutions are obsessed with knowing what the status for interest rates

in the economy is for a good reason. It is how they determine their lending

practices. It is also good information for a company that relies on debt capital to

finance ambitious projects.

Exchange Rates

This is a slightly more nuanced topic than that of interest rates. At the heart of it,

exchange rates are an important factor to consider for any business involved in

importation and exportation of various goods and services. When exchange rates

fluctuate, they affect the ability of a company to pay its international suppliers in a

satisfactory manner. This can also affect the profit margin of the company, as well

as the amount of resources it needs to stay afloat.

Recession

Whenever an economy faces a recession, it has the potential to change the attitude

taken by consumers toward their purchasing decisions. This may force companies

to drop prices to stay afloat.

In addition, Socioeconomic factors not only affects business and industry but of

Health and Education. The health of a person or people, in general, is to a great

extent determined by the environment as well as their circumstances. It affects

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the social status and income of the household or the person, educational level,

physical environment and etc. Socioeconomic status is not based solely on

income. There are a slew of other things, such as education level, financial

security, and the perceived social class and status of the individual. Along with

the quality of life enjoyed by the individual, consider the privileges and

opportunities gained as a result of this socioeconomic status.

Furthermore, these examples of socioeconomic factors not just affect small

business but also affects our industry as a whole: capital, income, tax and

revenues, investors and suppliers, households, and even international trade are

subject to fluctuate or to increased.

What’s More

In the new normal era, trend now is the online selling with small business

like selling of home-cooked food, pre-loved clothes, beauty essentials and many

others. How this affects our local economy and household income? Explain your

answer in your sheet of paper.

What I Have Learned

I have learned to define the following:

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 1. What are the socioeconomic factors that affects businesses? List down 3

factors. (Political, Economic, Social, Technology)

2. What are the other aspects that are affected by socioeconomic factors?

List down 2 aspects. (Health, Education)

3. How can one socioeconomic factor affect business and industry? Explain

your answer.

What I Can Do

Given that we are now facing pandemic, what do you think can be the

biggest socioeconomic factor that will greatly affect business and industry? Explain

your answer.

Assessment

Write T if the statement is true and F if the stamen is false.

1. Socio-economic is a branch of economics that concerns with the relationship

of economics and social behavior.

2. The study of social economics predicts what kind of result to expect when

the society has been changed.

3. Different socioeconomic classes will have different priorities and this will

affect how they spend their money.

4. Businesses and industry will continue growing even without understanding

the socio-economic factors.

5. PEST analysis are the main economic factors that affect a business.

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 6. If recession happened to a specific company the prices of their product will

increase.

7. Pandemic affects our social behavior.

8. Tax and revenues are stable in this pandemic times.

9. Demand will increase in this time of pandemic that leads to scarcity.

10.Business and Industry are affected by social behavior.

Additional Activities

Look around in your community. Identify one (1) social behavior that affects

you as a person and with your community. Write down your explanation.

Answer Key

What I know: List different socio-economic factors and explain

Socio-economic Factors: Political, Economic, Social, Technology

Assessment

1. F

2. T

3. T

4. F

5. T

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 6. F

7. T

8. F

9. T

10.T

Additional Activities: Student’s observation

References

K to 12 Curriculum Guide in ABM.

Google.com – Applied Economic
Pestle Analysis: PESTLE Analysis: Economic Factors Affecting Business

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