CURRICULUM GRADE 10 -12 DIRECTORATE
NCS (CAPS) SUPPORT
JUST IN TIME LEARNER REVISION DOCUMENT
ECONOMICS PAPER 1&2
GRADE 12
2022
Page 0 of 61
TABLE OF CONTENTS
NO.
TOPIC
PAGE NUMBER
PAPER 1
1
National Accounts aggregates and the multiplier
2-6
2
New Paradigm
6-9
3
Public Sector
10 - 13
4
Foreign Exchange markets
14 - 22
5
Protectionism and Free trade
22 - 26
6.
Economic growth and Development
27 - 34
PAPER 2
1.
Perfect markets
35 - 39
2.
Monopoly
40 - 43
3.
Monopolistic competition
44 - 45
4.
Oligopoly
46 - 50
5.
Market Failure
50 - 53
6.
Inflation
54 - 58
7.
Environmental sustainability
58 -62
Page 1 of 61
TOPIC 1:
NATIONAL ACCOUNT AGGREGATES AND MULTIPLIER
Activity 1
MULTIPLE CHOICE QUESTIONS
1.1
Various options are provided as answers to the following questions. Choose the answer and
write only the letter (A-D) next to the question number
1.1.1
The type of consumption of households spending which is independent of income is called ….
A.
B.
C.
D.
autonomous consumption.
induced consumption.
fixed consumption.
staple consumption.
1.1.2
A.
B.
C.
D.
Goods that are used in the production of other goods are referred to as ….
final goods.
raw goods.
intermediate goods.
immediate goods.
1.1.3
A.
B.
C.
D.
The market where short- and medium-term loans are made is ….. market.
money.
capital.
goods
resource
1.1.4
A.
B.
C.
D.
The portion of income earned that is rather saved than spent is knows as……
marginal rate of taxation
marginal propensity to consume
marginal propensity to invest
marginal propensity to save
1.1.5
The flow of production factors and goods / services between participants in the circular flow is
known as……
money flow.
commodity flow.
real flow.
current flow.
A.
B.
C.
D.
1.1.6
A.
B.
C.
D.
The inflow of money into the economy is known as…….
leakages.
market.
income.
injections.
Page 2 of 61
1.2 Choose a description from column B that matches the item in Column A. Write only the letter next
to the question number. (1.2.1- H)
COLUMN A
1.2.1 Double counting
1.2.2
Gross Domestic Product
COLUMN B
A
A small change in spending causes a more than proportional
increase in the national income.
B
The portion of an increase in income that is not consumed.
1.2.3
Imports
C
Allows for all errors and omissions in GDP calculations.
1.2.4
Multiplier
D
The money spent on capital goods by businesses of firms.
1.2.5
Investment
E
1.2.6
Market price
F
The value of goods and services produced within the
boundaries of the country in a given year.
Goods produced domestically and bought by the foreign sector.
1.2.7
Residual item
G
1.2.8
Marginal propensity to save
H
I
Addition of the intermediate goods to the national income
figures
The final price paid by the consumers for goods and services.
Goods produced by the foreign sector and purchased by
households.
1.3 Provide the economic erm/concept for each of the following descriptions. Write only the
term/concept next to the question number. No abbreviations will be accepted.
1.3.1
An initial change in spending results in a much bigger change in the national income.
1.3.2
The flow of goods and services between the participants in the circular flow.
1.3.3
The total remuneration for the factors of production received by the people of South Africa
nationally in a given period.
Government spending to the citizens without any services rendered.
The expenditure that depends on the level of income.
National income figures that have taken inflation into account.
1.3.4
1.3.5
1.3.6
Page 3 of 61
SECTION B
Activity 2
2.1.1
2.1.2
List two leakages found in the multiplier of a four-sector model.
Why is it important to prepare the national accounts of a country.
(2X1) 2
(1X2) 2
2.2
Study the table below and answer the questions that follow
GROSS VALUE ADDED ACCORDING TO TYPE OF ECONOMIC ACTIVITY
At current prices (R millions)
2020
2021
Primary sector
491 860
627 753
Secondary sector
941 459
1 042 456
Tertiary sector
3 596 256
3 902 399
Gross value added at basic prices
5 029 575
A
[Adapted: SARB Quarterly Bulletin, JUNE 2022]
2.2.1
2.2.2
2.2.3
2.2.4
2.2.5
Name the method that was used in the calculation of the gross domestic product?
Which sector has increased its contribution the most since 2020?
Briefly describe the term real Gross Domestic Product.
Explain the impact of double counting in the National Income.
Calculate the value of A. Show all calculations.
(1)
(1)
(2)
(2)
(4)
2.3
Differentiate between taxes on production and taxes on products.
(8)
Activity 3
Study the table below and answer the following questions.
National account figures 2021 at constant prices
Item
2021
R million
3 819 180
A
792 487
810 714
-18 227
5 828 317
1 796 750
134 926
7 490 141
Final consumption expenditure by households
Final consumption expenditure by general government
Gross capital formation
Gross fixed capital formation
Change in inventories
Gross domestic expenditure
Exports of goods and services
Imports of goods and services
Gross domestic product
Source: SARB QB 2022
3.1.1
3.1.2
3.1.3
3.1.4
3.1.5
Which method of calculating the national account is used above?
Name One example of income earned by foreigners.
Describe the term gross fixed capital formation.
How does an increase in government spending affect the size of the multiplier.
Use the table above and calculate the value of A.
(1)
(1)
(2)
(2)
(4
Page 4 of 61
Activity 4
4.1
Study the graph below and answer the following questions
MULTIPLIER
E=Y
EXPENDITURE(E)
E1=30+0.5Y
60
E0=10+0.5Y
30
0
20
1
0
4.1.1
4.1.2
4.1.3
4.1.4
4.1.5
4.2
20
60
OUTPUT/INCOME(Y
)
Name the original consumption function on the graph.
Identify the marginal propensity to consume (mpc) from the above graph
Briefly describe the term induced consumption.
How does an increase in tax influence the value of the multiplier?
Using the formula ∆Y/∆J, calculate the value of multiplier for the above diagram.
Show all calculations.
Calculate and discuss the multiplier and its effect on the national income if the
marginal propensity to consume (mpc) is 0.6 and investment increases by 10bn.
(1)
(1)
(2)
(2)
(4)
(8)
Activity 5
5.1
Study the extract below and answer the questions that follow.
Multiplier effect-two sector model
The consumption functions consist of autonomous consumption and induced consumption (C=C+CY).
However, every time there is an injection into the circular flow of income there is likely to be a multiplier
effect.
The size of the multiplier depends upon households’ marginal propensity to save (mps). For instance, if
60% of all new income in a given period is spent on South African products, the marginal propensity to
consume would be 0,6.
Page 5 of 61
5.1.1
5.1.2
5.1.3
5.1.4
5.1.5
Identify an example of a leakage in the above.
Name any ONE participant in a two a two-sector model.
Briefly describe the term autonomous consumption.
Why is the value of the multiplier in a four-sector model smaller than that of a
two-sector model?
Using the marginal propensity to consume (mpc) 0.6 calculate the change in the
national income if there was an investment of R250 M. Show all calculations.
(1)
(1)
(2)
(2)
(4)
Activity 6
6.1. Study the extract below and answer the questions that follow:
THE STATE OF THE SOUTH AFRICAN ECONOMY
The recovery in domestic economic activity following the sharp contraction in the second quarter of 2020
continued in the fourth quarter as the coronavirus disease 2019 (COVID 19) lockdown restrictions were
eased further. However , growth in real gross domestic product (GDP)moderated markedly to an
annualised rate of 6.3%in the fourth of 2020 , from a revised 67.3%in the third quarter . For the year a
substantial 7.0% after a marginal increase of only 0.2% in 2019 .The national lockdown-induced
contraction since 1920 , when the real GDP fell by 11.9% and was also about five times larger than the
contraction of 1,5% that followed the global financial crisis (GFC) IN 2009.
Source (SARB Quarterly Bulletin 2021)
6.1.1. Name the international institution that guides the compilation of South Africa’s national account
aggregates.
(1)
6.1.2. Identify the trend of the South African economy since the lockdown.
(1)
6.1.3. Briefly describe the term disposable income.
(2)
6.1.4. Explain the effect of an in increase in Gross National Income on households.
(2)
6.1.5. Why are national accounts important to a country?
(4)
NEW ECONOMIC PARADIGM
Activity 1
1.1
Various options are provided as possible answers to the following questions. Choose the correct
answer and write ONLY the letter (A – C) next to the question number (1.1.1 – 1.1.3) in the
ANSWER BOOK. e.g 1.1.3 D
1.1.1
The lowest turning point in a business cycle is called…
A. trough. 
B. peak.
C. trend.
D. amplitude.
Page 6 of 61
1.1.2
Indicators which change before the business cycle changes are called … indicators.
A. lagging
B. leading 
C. coincident
D. business
1.1.3
A policy that attempts to stimulate economic activity is called ...fiscal policy
A. restrictive
B. monetary
C. expansionary 
D. leading
1.1.4
A policy that is used to control money supply is called… policy.
A. fiscal
B. demand
C. supply
D. monetary 
1.1.5
Statistical analytical tool that is used to analyse the changes that occur in a series of data over
a certain period of time is called …
A. moving averages 
B. extrapolation
C. time series
D. trend line
(5 x 2) (10)
1.2
Choose a description from COLUMN B that matches the item in COLUMN A. Write only the letter
(A – I) next to the question numbers (1.2.1. to 1.2.8) in the ANSWER BOOK.
COLUMN A
COLUMN B
1.2.1 Cash incentive
A. Expenses that are incurred by the businesses but not directly
related to production.
1.2.2 Managed floating
B. The minimum balance that banks are required by law to keep in
their accounts.
1.2.3 Unemployment
C. Price of one currency expressed in terms of another currency.
D. When the central bank intervenes in the economy to control the
1.2.4 Administrative Costs
currency of a country.
E. People within the labour force who are willing and able to work
1.2.5 Fiscal Policy
but unable to work.
F. Subsidy used by government to encourage exporting
1.2.6 Demand side approach
businesses to locate in neglected areas.
G. The exchange rate policy that is determined by forces of supply
1.2.7 Cash reserve requirement
and demand.
H. The use of government spending and taxation to influence the
1.2.8 Exchange rate
economy.
I. When economic growth and full employment is achieved by
increasing demand for goods and services.
(8x 1) (8)
Page 7 of 61
1.3
Give ONE term for EACH of the following descriptions. Write only the term next to the question
numbers (1.3.1 to 1.3.6) in the ANSWER BOOK. Abbreviations, acronyms and examples WILL
NOT be accepted.
1.3.1.
1.3.2.
1.3.3.
1.3.4.
A policy used by the central bank to control the supply of money in the economy.
Exchange rate system that uses forces of demand and supply.
Removal regulations and government control measures that interfere with free trade.
A specific range through which the South African Reserve Rank wants to control the money
supply.
1.3.5. A sustained general increase in the price level of goods and services.
1.3.6. An economic measure used by the government to stimulate aggregate supply in the economy.
(1 x 6) (6)
ACTIVITY 2
2.1.
Answer the following questions.
2.1.1. Name any TWO fiscal policy instruments.
2.1.2. What is the aim of moral suasion?
2.2
Study the graph below and answer the questions that follow.
(1x2)
(2)
(2)
DEMAND AND SUPPLY SIDE POLICIES
AD1
AS
Price Level
AD
AS1
e
R80
e1
AD1
AS
AD
AS1
0
2.2.1
2.2.2
2.2.3
2.2.4
2.2.5
20
30
Quantity
Name the policy that uses demand and supply to smooth business cycles.
what is the desirable quantity according to this graph?
Briefly describe the term real business cycles.
What caused the demand curve to shift from AD to AD1?
How can government improve the efficiency of markets in the economy?
(1)
(1)
(2)
(2)
(4)
Page 8 of 61
ACTIVITY 3
3.1
Study the extract below and answer questions that follow.
Does the economy have room for expansion?
An economy’s ability to grow can be constrained by factors that limit its ability to produce goods and
services – “supply-side” factors like poor infrastructure or a lack of education. It can also be constrained
by a lack of funds to purchase the goods and services it does produce – “demand-side” factors.
The International Monetary Fund and South Africa’s national treasury argue that the country’s poor
growth performance over the past decade is due to supply-side factors. These include infrastructural
bottlenecks in electricity generation and supply, over-regulated labour markets, and increases in product
market concentration as seen in rising profit mark-ups.
Source: www.wits.ac.za
3.1.1 Name any ONE policy in which the new economic paradigm is embedded.
3.1.2 Which government department is responsible for controlling government spending?
3.1.3. Briefly describe the term producer subsidies.
3.1.4. Explain the shortage of skilled workers as a factor that limits supply.
3.1.5. Why is it necessary to dampen an overheating economy?
(1)
(1)
(2)
(2)
(4)
3.2
Discuss improving the efficiency of inputs as supply-side measure.
(8)
3.3
With an aid of a Phillips curve, discuss the new economic paradigm.
(8)
3.4
Analyse the ineffectiveness of demand-side policies in the economy of South Africa.
(8)
Activity 4

Discuss in detail the new economic paradigm in smoothing out business cycles.
(26)
Page 9 of 61
PUBLIC SECTOR
Activity 1
1.1 Various options are provided as possible answers to the following questions. Choose the correct
answer and write only the letter (A-D) next to the question numbers.
1.1.1 Policy makers who watch trends and change policies when the economy is not
performing satisfactorily make use of…stabilisers
A. automatic
B. manual
C. discretionary
D. expansionary
1.1.2
Long and time-consuming procedures that hampers service delivery pace.
A. corruption
B. incompetence
C. competence
D. bureaucracy
1.1.3
Goods which are not possible to exclude free riders once they have been
provided are called… goods.
A. communal
B. merit
C. collective
D. demerit
1.1.4
The government level that encompasses metropolitan, districts and municipalities,
is called....
A. local.
B. provincial.
C. national.
D. central.
(4x2)(8)
Choose a description from COLUMN B that matches the item in COLUMN A. Write only the
letter (A – I) next to the question number (1.2.1 – 1.2.5) in the ANSWER BOOK, for example
1.2.9 J.
(1x5)=(5)
1.2.1 Nationalisation
A Government's plan of expenditure that covers a
three-year period.
1.2.2 Demerit goods
B A business owned wholly or partly by the state and
run by a public authority.
1.2.3 Taxation
C When government takes-over businesses that were
previously owned by private sector
1.2.4 State-owned enterprise
D They are deemed as harmful to the society.
1.2.5 Medium Term Budget Policy E The level of government that is concerned with
Statement
national issues.
F Direct or indirect compulsory payments to the
government.
Page 10 of 61
Give ONE term for each of the following descriptions. Write only the term next to the question number
(1.3.1 – 1.3.5) in the ANSWER BOOK. Abbreviations, acronyms and examples will NOT be accepted.
1.3.1
1.3.2
1.3.3
1.3.4
1.3.5
Transfer of functions and ownership of entities from the private sector to the
public sector
The government process of removing or reducing regualitions.
Large public corporations or business entities in the public sector.
A condition where it is impossible to make someone better off without making
someone else worse off.
The action taken by government in respect of taxation, government spending and
borrowing in order to influence economic activity
(1x5)=(5)
Activity 2
2.1.1
2.1.2
2.2
2.2.1
2.2.2
2.2.3
2.2.4
2.2.5
Give any TWO examples of indirect tax.
Why is an efficient local government important for the community?
(1x2)= (2)
(2)
Study the graph below and answer questions that follow
Identify the figure in which the tax rate will be maximised
How much is the tax revenue if the tax rate is 100%?
Briefly describe the term privatisation.
What is the implication of charging tax rate that is above 80% to the
consumers?
How does the problem of assessing needs become a challenge of public
sector provisioning?
(1)
(2)
(2)
(4)
Page 11 of 61
2.3
Study the extract below and answer questions that follow:
‘State capture’: the corruption investigation that has shaken South Africa
South Africans watched, transfixed, as video from a hidden mobile phone camera was broadcast
on TV. It showed a group of men, in corporate uniforms, walking into a vault – where one of
them counts out bundles of banknotes: “One, two, three, four, five … bloody Monopoly money,”
he laughs through heavy breaths, “must be a million.”
Source :www.theguardian.com
2.3.1 Identify the reason for public sector failure above.
(1)
2.3.2
2.3.3
2.3.4
2.3.5
2.4
2.5
(1)
(2)
(2)
(4)
(8)
(8)
Give any ONE example of merit goods.
Briefly describe the term public sector failure
Why is it important for information to be accurate in the public sector?
How does corruption affect service delivery?
Discuss the effects of public sector failure
How can subsidies as a strategy of the government to minimize unemployment.
Activity 3
Answer the following questions
3.1.1
List any TWO examples of parastatals
3.1.2
How can VAT be used to stimulate the economic growth in the country?
3.2
(2)
(2)
Study the cartoon below and answer questions that follow
3.2.1
Name the public corporation shown above.
(1)
3.2.2
Who presents the national budget in South Africa?
(1)
3.2.3
Briefly describe the term medium-term expenditure framework.
(2)
3.2.4
Explain the effect of high state debts to the service delivery by the government.
(2)
3.2.5
How is a budget helpful for a government?
(4)
Page 12 of 61
3.3
Study the data below and answer that follow
3.3.1
3.3.2
3.3.3
3.3.4
3.3.5
Name the government organisation shown by the picture above.
(1)
Which institution is responsible for collecting government’s revenue?
(1)
Briefly describe the term parastatals.
(2)
What negative impact will full employment have on price stability?
(2)
Discuss negative effect of indirect tax on the economy equity in the
country.
(4)
Discuss price stability and economic equity as macroeconomic objective.
(8)
3.4

3.5
Evaluate the provisioning of public goods and services in South Africa?
(8)
Essay questions
Activity 4


Discuss in detail macroeconomic objectives
Evaluate the impact Social rights that promoted through the national budget?
(26)
(10)
[40]
Activity 5


Discuss in details the reasons for public sector failure.
How can inefficiencies contributing to public sector failure be solved
(26)
(10)
[40]
Page 13 of 61
FOREIGN EXCHANGE MARKETS:
BALANCE OF PAYMENTS
ACTIVITY 1
1.1.
Various options are provided as possible answers to the following questions. Choose the answer
and write only the letter (A-D) next to the question number.
1.1.1. The difference between merchandise imports and exports is referred to as the trade…
A. balance
B. surplus
C. deficit
D. neutrality
1.1.2. Investment in shares is known as… investments.
A. property
B. banks
C. portfolio
D. capital
1.1.3. The systematic record of country’s transactions with the rest of the world, is known as the…
A. balance of payments
B. current account
C. trade balance
D. national account
1.1.4. Financial capital held by the monetary authorities such as the central bank to finance the trading
disequilibrium is referred to as…
A. financial derivatives
B. merchandise exports
C. portfolio investments
D. reserve assets
1.1.5. The account that reflects the ownerships of fixed assets and their transfer by migrants is referred
to as…account
A. capital transfer
B. current transfer
C. financial
D. current
1.1.6. In the balance of payment tangible goods form part of the……….
A. financial account
B. current account
C. capital transfers account
D. investment
Page 14 of 61
1.1.7. A form of credit that the International Monetary Fund (IMF) can use when a country experiences
balance of payments difficulties
A. Financial derivatives
B. Export subsidies
C. special drawing rights
D. foreign exchange
(7x2=14)
1.2
Choose a description from Column B that matches the item I Column A. Write only the
letter (A-I) next to the question number (1.2.1-1.2.8) in the answer book.
Column A.
Column B
1.2.1. Terms of trade
A. Items transferred from residents to non-residents and
vice versa without any counter performance required.
1.2.2. International Trade
B. Financial contracts that derives their value from
underlying assets.
C. The value of tangible exports minus tangible imports.
1.2.3. Reserve assets
1.2.4. Portfolio investment
D. The exchange of goods and services across the
international boarder.
1.2.5. Current transfers
E. Acquisition of more than 10% share in a business.
1.2.6. Special drawing Rights
F. Records of the purchase of financial assets such as
shares.
G. Financial capital held by the monetary authorities, in the
form of foreign currency.
1.2.7. Trade balance
1.2.8. Financial derivatives
H. A financial instrument distributed among member
countries of the IMF to help with BOP problems.
I. Ratio of expert prices in terms of import prices
(8x1=8)
1.3
1.3.1
1.3.2
1.3.3
1.3.4
1.3.5
1.3.6
Give one term for each of the following descriptions. Write only the term next to the
question numbers (1.3.1 to 1.3.6) Abbreviations, acronyms and examples will not be
accepted.
An investment in the acquisition of a significant share in a business.
A systematic record of a country’s transactions with the rest of the world.
Visible goods that South Africa sells to other countries.
An organisation that lends money to countries with on -going balance of payments deficit.
An entry that is used to capture the effects of errors, omissions and timing differences in the
balance of payments
The account that is used to record transactions of migrants.
(1x6= 6)
Page 15 of 61
Activity 2
2.1.1
2.1.2
Name any TWO goods that are part of merchandise exports.
Why is gold export listed as a separate item in the South Africa’s balance of payments?
2.2
Study the table below and answer the questions that follow.
Indices of volumes and prices
2020
2015 = 100
Year
2021
Q1
Q2
Q3
Q4
Exports
Volume
Price
87.6
95.8
98.8
91.2
99.0
143.0
157.3
166.6
169.0
162.4
83.4
90.9
90.8
87.7
95.5
120.6
125.1
129.6
134.7
140.0
A
125.7
128.5
125.5
116.1
Imports
Volume
Price
Terms of trade
Source: stats SA & SARB
2.2.1
2.2.2
2.2.3
2.2.4
2.2.5
Give the base year that the South African Reserve Bank use to compile the terms of trade.(1)
Identify the quarter with the highest volume of export on the above table.
(1)
Briefly describe the term balance of payments.
(2)
How does an increase in imports affect South Africa’s exchange rate?
(2)
Calculate the terms of trade for the year 2020(A).Show all calculations.
(4)
2.3
How can export promotion and import substitution restore equilibrium to the balance
of payments?
2.5. Briefly explain the financial derivatives as an item of the financial account.
(8)
(8)
Activity 3
3.1.1 Name TWO items of financial account of the balance of payments
3.1.2 Why are liabilities added when calculating net direct investment in the financial account of the
balance of payments?
Page 16 of 61
3.2
Study the table below and answer the questions that follow.
Current account of the balance of payments
R billions
2020
Seasonally adjusted and annualised
Year
Q1
Q2
2021
Q3
Q4
Year
Current account credits (Receipts)
Goods and services
1 534
1 847
2 016
1 889
1 971
1 931
Exports of goods
1 394
1 729
1 887
1 757
1 811
1 796
Merchandise exports (free on board)
1 286
1 622
1 786
1 652
1 692
1 688
Net gold exports
108
107
100
105
120
108
Services receipts
140
118
129
133
159
135
129
171
114
244
141
168
1 105
1 271
1 317
1 318
1 487
1 348
Primary income receipts
Merchandise imports (free on board)
Source: stats SA & SARB
3.2.1
3.2.2
3.2.3
3.2.4
3.2.5
Identify the quarter where service receipts were the lowest.
Which item capture visible goods sold to other countries?
Briefly describe the term trade balance.
Why is the unrecorded transactions entry important the balance of payments?
Calculate the trade balance for the year 2021. Show all calculations.
(1)
(1)
(2)
(2)
(4)
3.3
Differentiate between direct investment and portfolio investment as components of
the financial account.
(8)
3.4. Briefly explain the impact of the Russia/Ukraine war on the South African balance of payment. (8)
Activity 4
4.1
Study the cartoon below and answer the questions that follow.
Source: Google
Page 17 of 61
4.1.1
4.1.2
4.1.3
4.1.4
4.1.5
Identify a term indicating there are more imports than exports, from the above cartoon.
Which institution helps countries who have Balance of payments problems?
Briefly describe the term terms of trade.
How can portfolio investment contribute to balance of payments deficit?
Briefly explain how taxes help to correct balance of payment deficits.
4.2
How can the monetary policy be used to solve balance of payment disequilibria?
4.3. How effective is import substitution in solving balance of payments disequilibria?
(1)
(1)
(2)
(2)
(4)
(8)
(8)
Activity 5
5.1.1
Name TWO items forming the reserve assets in the balance of payments.
5.1.2
How does the International Monetary Fund help when there is a BOP disequilibrium?
5.2
Study the extract below and answer the questions that follow.
South Africa Current Account Surplus Widen in Q1
The current account surplus in South Africa rose to ZAR 143 billion in the first quarter of 2022, from an
upwardly revised ZAR 132 billion in the fourth quarter of 2021.
The good surplus widened to ZAR 360 billion from ZAR 336 billion in the previous period, reflecting a
larger increase in the value of merchandise and net god exports than in the value of merchandise
imports.
Source: tradingeconomics.com
5.2.1. Identify a term that indicates South Africa’s exports were more than its imports.
5.2.2. What was the change in the surplus between 2021 Q4 and 2022 Q1?
5.2.3. Briefly describe the term portfolio investment.
5.2.4. What is the importance of foreign direct investment in the economy?
5.2.5. How could natural disasters such as floods affect South African trade balance?
(1)
(1)
(2)
(2)
(4)
5.3. Differentiate between current transfers and the capital transfers..
5.4. Evaluate the impact of having sustained trade surplus on the economy.
(8)
(8)
Page 18 of 61
JIT ACTIVITIES (FOREIGN EXCHANGE MARKET) 2022
ACTIVITY 1
1.1 Various options are provided as possible answers to the following questions. Choose the answer
and write only the letter (A-D) next to the question number (1.1.1-1.1.4) in the ANSWER BOOK, for
example 1.1.7 C
1.1.1
The price of currency in terms of another is called …rate.
A. exchange
B. prime
C. repo
D. inflation
1.1.2
The market that is engaged in buying and selling foreign currencies is known as …market.
A. capital
B. resource
C. foreign exchange
D. financial
1.1.3
The exchange rate system where currencies are devaluated or revaluated is called …rate.
A. managed floating exchange
B. fixed exchange
C. foreign exchange
D. free floating exchange
1.1.4
A decrease in the value of a currency due to market forces is known as …
A. revaluation
B. devaluation
C. appreciation
D. depreciation
1.2
Give ONE term for each of the following descriptions. Write only the term next to the question
number (1.2.1-1.2.5)
Compares a country’s export prices to its import prices by means of indexes.
Restrictions of government on the purchase or sale of foreign currencies by private residents.
Sustained increase of prices and services in a country over a period of time.
The price where demand of currencies equals to supply
1.2.1
1.2.2
1.2.3
1.2.4
Page 19 of 61
Activity 2
2.1 Study the graph below and answer the questions that follow:
2.1.1 Identify quantities of dollars that are demanded at original equilibrium point.
2.1.2 Name the new equilibrium point from the graph.
2.1.3 Briefly describe the term exchange rate.
2.1.4 Explain the effect of depreciation of rand on exports.
2.1.5 How can an increase in the number of US tourists to South Africa influence the
value of the rand
(1)
(1)
(2)
(2)
(4)
ACTIVITY 3
3.1 Study the graph below and answer the questions that follow:
Page 20 of 61
3.1.1 Identify the original equilibrium point.
3.1.2 Name the exchange rate system represented by the graph above.
3.1.3 Briefly describe the term foreign exchange market.
3.1.4 Explain what will be the effect of an outward shift in supply on the value of a rand.
3.1.5 How can the Central Bank of South Africa intervene in the exchange market to
influence the exchange rates?
(1)
(1)
(2)
(2)
(4)
Activity 4
4.1
Read the extract below and answer the questions that follow:
STRENGTHEN or APPRECIATE vs WEAKEN or DEPRECIATE
Exchange rate tend to fluctuate substantially, even between bordering companies such as the United States
and South Africa. By looking closely at the time values (the years vary slightly on the graphs), it is clear that
the values in part(a) are a mirror image of part (b), which demonstrates that the depreciation of one currency
correlates to the appreciation of the other and vice versa.
This mebans that when comparing the exchange between of two countries (in this case, the United State
and South Africa) the depreciation (or weakening) of one country (the US dollar for this example indicates
the appreciation (or strengthening) of the other currency.
[source:www.google.com]
4.1.1 Identify the term in the extract above that refers to an increase in the value of a currency.
(1)
4.1.2 Which currency is used in South Africa?
(1)
4.1.3 Briefly describe the term depreciation.
(2)
4.1.4 Explain the negative effect of an appreciation of currency in the economy.
4.1.5 How can an increase in the demand for dollars negatively affect the South African economy (4)
Activity 5
5.1
Study the table below and answer the questions that follow:
SOUTH AFRICAN: TERMS OF TRADE
Year
Index of import prices
2020
179
2021
163
5.1.1
5.1.2
5.1.3
5.1.4
Index of export prices
Terms of trade
214
119,7
200
A
[source: SARB Quarterly Bulletin, March 2021]
Name the institution responsible for publishing the data above.
What is the trend in the index of import prices?
Briefly describe the term terms of trade.
Explain why an increase in the terms of trade will have a positive effect on the
welfare of the country.
5.1.5 Calculate the terms of trade for 2021 (A). Show all calculations.
(1)
(1)
(2)
(2)
(4)
Page 21 of 61
Activity 6
6.1
6.2
6.3
6.4
Differentiate between managed floating and free-floating exchange rates system.
Differentiate between appreciation and revaluation.
How can a weaker rand impact on South Africa’s trade with other countries?
How can changes in terms of trade influence the South African economy?
(8)
(8)
(8)
(8)
ECONOMICS PURSUITS
PROTECTIONISM AND FREE TRADE
Activity 1
Multiple choice
1.1
Various options are provided as possible answers to the following questions.
Choose the answer and write only the letter (A–D) next to the question
number.
1.1.1
It when there are no restrictions to trade such as taxes on goods or bans on
imports, it is called …
A. dumping .
B. protectionism .
C. free trade .
D. diversification .
1.1.2
Interfacing and interaction of economies, with trade as a key element, is known as …
A. free trade.
B. communication.
C. industrialization.
D. globalization.
1.1.3
The application of a trade policy whereby the state discourage importing of certain goods and
services is called …
A. protectionism.
B. import substitution.
C. export promotion.
D. globalization.
Page 22 of 61
1.1.4
Newly established firms that still need protection are called ……. Industries
A. competitive
B. strategic
C. declining
D. infant
1.1.5
The practice of selling goods in a foreign country at lower prices than in the country of origin is
known as ……
A. exportation
B. dumping
C. importation
D. import substitution
1.1.6
When import duties are imposed as a percentage of the value of the imported goods, it is known
as ……. tariffs
A. composite
B. specific
C. ad valorem
D. average
1.1.7
Economic integration where member countries agree on a common economic policy is called
a……..
A. free-trade area.
B. customs union.
C. economic union.
D. common market.
1.1.8
Goods that were previously imported are replaced with goods local is called …
A. Subsidies.
B. import substitution .
C. export promotion.
D. Diversification.
1.1.9
Payments made by the government to local producers for them to be competitive.
A. subsidies
B. tariffs
C. quotas
D. import substitution
Page 23 of 61
1.2
Choose a description from COLUMN B that matches the item in COLUMN A. Write only the
letter (A-E) next to the question number (1.2.1 – 1.2.5) in the ANSWER BOOK.
Column A
Column B
1.2.1 Trade liberalization
1.2.2 Protectionism
1.2.3 Ad valorem
1.2.4 Export promotion
1.2.5 Dumping
1.2.6. Sanctions
A.
B.
C.
D.
E.
F.
G.
1.3
1.3.1
1.3.2
1.3.3
1.3.4
1.3.5
1.3.6
Is a tariff as percentage of the value of imported goods
Is a tariff that is charge at a certain amount per unit, mass
or size of a good
The government policies and regulations which are designed to
benefit local producers of goods and services in their
competition with imported goods
The abolition of government intervention in trade flows on both
the import and export.
Penalty applied by one or more countries on another country
The practice of selling goods in a foreign country at lower prices
than in the country of origin..
Incentives to encourage the production of goods that can be
exported.
(6 x 1) (6)
Give the economic term for each of the following descriptions. Write only the term/concept
next to the question number.
Goods that were previously imported are replaced with local produce goods.
Withdrawal of capital investment from a company or a country.
The financial help given to exporters to help them export their goods.
A limited supply of goods and services to reduced imports.
The situation where by consumers and producers are free to buy and sell goods anywhere
without any restrictive.
World-wide exposure and interaction of economies with trade as a key element.
(6x 1) (6)
Activity 2
2.1.1 Name any TWO import substitution methods.
2.1.2 What effect will quotas have on imports?
(1x2)
(2)
(2)
Page 24 of 61
2.2
Study the cartoon below and answer the questions that follow:
Source:cagleCartoon.com
2.2.1
2.2.2
2.2.3
2.2.4
2.2.5
Identify the trade policy applied by the government in the cartoon above. (1)
Name the method that is used to limit the supply of goods and services. (1)
Briefly describe the term globalisation.
(2)
What is the impact of dumping on the South African economy?
(2)
How can protectionism positively affect the economy?
(2 x 2) (4)
Activity 3
3.1.1
Name any two types of trade protocols.
3.1.2
How dumping negatively affect job opportunities? (2)
3.2 Study the extract below and answer the questions that follow:
United States-Southern African Customs Union (SACU) Free Trade Agreement Negotiations:
Negotiations to launch a Free trade agreement (FTA) between the US and the five members of the SACU
(Botswana, Lesotho, Namibia, South Africa and Swaziland) began on June 3, 2003. A potential FTA would
eliminate tariffs, eliminate non tariffs barriers, liberalize trade and provide technical assistance to help
SACU nations achieve the goals of the agreement.
[Source:www.bea.gov/international]
3.2.1 Identify ONE trade agreement that South Africa is part of with other African countries.
3.2.2 Name the form of economic integration that satisfies the requirement of custom union.
3.2.3 Briefly describe the term free trade area.
3.2.4 Explain the impact of free trade on the prices of goods.
3.2.5 How would imposing tariffs on imported goods benefit South Africa?
(2 x 2)
(1)
(1)
(2)
(2)
(4)
Page 25 of 61
3.3. Study the cartoon below and answer the questions that follow.
WTO
3.3.1
3.3.2
3.3.3
3.3.4
3.3.5
Which International organization encourages free trade?
Name the term that relates to the worldwide integration of the economy
through trade.
Briefly describe the term export promotion.
Explain the importance of free trade in developing countries?
Why is it important for government to keep on protecting their key strategic
industries against industrial take-overs?
(2x2)=
(1)
(1)
(2)
(2)
4
Activity 4
4.1.1
4.1.2
4.1.3
4.1.4
4.1.5
Explain specialisation and economies of scale as arguments in favour of free trade.
Discuss the different forms of economic integration.
How successful are the methods implemented by South Africa to promote
exports of goods and services?
Evaluate the successes of South African government to promote its products
to foreign markets?
How can the government protect local infants industries?
(8)
(8)
(8)
(8)
(8)
Activity 5 ESSAYS
5.1 Discuss export promotion in detail.
 Reasons
 Methods
 Advantages
 Disadvantages
5.2
Discuss in detail the arguments in favour of protectionism.
(26)
(26)
Page 26 of 61
Economic Growth and Development
Activity 1
1.1
Various options are provided as possible answers to the following questions. Choose the
answer and write only the letter (A–D) next to the question number.
1.1.1. The strategy that failed in its objective to halve poverty and unemployment by 2014 is called …….
A. New Growth Path
B. Accelerated and Shared Growth initiative for South Africa
C. Reconstruction and Development Plan
D. National Development plan
1.1.2. Social grants to the citizens of South Africa form part of ……… policy.
A. monetary
B. trade
C. growth
D. fiscal
1.1.3. An interest rate that commercial banks offer to their most valued clients is called…..
A. prime rate
B. repo
C. fixed
D. preference
1.1.4. The growth and development policy that aims to eliminate poverty and reduce inequality by 2030
is called….
A. national Development Plan
B. new Growth Path
C. JIPSA
D. RDP
1.1.6. Buying and selling of government securities by SARB are called …….
A. open market transaction
B. cash reserve requirement
C. interest rate
D. moral suasion
1.1.7. A tax system where high income-earners pay higher rate of tax is called…
A. regressive
B. capital formation
C. proportional
D. progressive
(2x7)=14
Page 27 of 61
1.2
Choose a description from COLUMN B that matches the item in COLUMN A. Write only the
letter (A-E) next to the question number (1.2.1 – 1.2.6) in the ANSWER BOOK.
COLUMN A
1.2.1 Moral suasion
1.2.2. JIPSA
1.2.3 Economic growth
1.2.4. Expanded public works
programme
1.2.5. Cash reserve requirement
1.2.6. Repo Rate
1.3
COLUMN B
A. Nationwide government intervention to create employment
using labour intensive methods.
B. SARB consultation with banks to act in a desirable manner
according to prevailing economic condition
C. The minimum amount of money that the SARB requires
banks to maintain in order to manipulate money creation activities.
D. the process that focuses on the improvement of people’s
standard of living.
E. Increase in the country’s production capacity
F. Focus on the skills acquisition
G. rate at which SARB charges commercial banks when lending.
Give one term for each of the following description. Write only the term next to the question
numbers.
1.3.1
Return of land to those who have lost it due to discriminatory laws of the past.
1.3.2
The process that focuses on the improvement of people’s standard of living.
1.3.3
Tax levied on gains earned on the sale of capital goods, such as properties and shares
1.3.4
Increase in capacity of a country to produce goods and services
1.3.5. A plan to bring disadvantaged group to participate in the mainstream of economic activities
1.3.6. Duties paid to the estate of the deceased
1.3.7. A labour-intensive government programme to create employment
1.3.8. A redress policy that focuses on land for residential and production farm for previously
disadvantaged groups
(8X1)=8
Activity 2
2.1.1
Name TWO monetary policy instruments that the SARB use to influence
aggregate demand in the economy.
2.1.2
(1x2)
(2)
How can the interest rate be used by South African reserve bank to stimulate
production of goods and services.
(2)
Page 28 of 61
2.2
Study the cartoon below and answer the questions that follow
2.2.1
2.2.2
2.2.3
2.3.4
Which countries are referred to as a developing country in the above cartoon?
Name any ONE component related to the standard of living
Briefly describe the term per capita income.
How could countries in the South overcome the income gap that divides the
North from the South.
Discuss the challenge of globalization between the North and South.
2.2.5
(1)
(1)
(2)
(2)
(4)
Activity 3
3.1.1 Name TWO fiscal policy instruments that the government can use to stimulate
growth and development.
3.1.2 How do countries in the North divide contribute to the destruction of the environment?
3.2
(2)
(2)
Study the extract below and answer the questions that follow.
LET’S GO BACK TO THE NDP: encouraging active citizens with their own development
The sight of people in orange uniforms carrying brooms and garbage bags, sweeping and weeding
roadside verges, often alone, has been a common one across the country since 2003 when the
Department of Public Works launched its Expanded Public Works Programme (EPWP).
The government adopted the NDP at the beginning of the past decade to
eliminate poverty and reduce inequality.
[Source: Adapted from National]
3.2.1
3.2.2
3.2.2
3.2.3
3.2.5
What type of workers are often employed through the Expanded Public
Works Programme?
Name the development policy that aims to eliminate poverty and reduce
inequality by 2030.
Briefly describe the term economic development.
Explain how the development of human resources can be used as an approach
to alleviate poverty.
How can the NDP increase the employment rate in South Africa?
(1)
(1)
(2)
(2)
(4)
Page 29 of 61
Activity 4
4.1.1 Name TWO demand side approach measures that are used to stimulate economic
growth and development
4.1.2 How can the cost of doing business influence the supply of goods and services?
4.2
(2)
(2)
Study the cartoon below and answer the questions that follow:
Real GDP
Unemployment
Real GDP per Capita
4.2.1
4.2.2
4.2.3
4.2.4
4.2.5
Identify one example that measure the economic growth.
Name the growth policy that failed to meet it objective in 2014
Briefly describe the term globalization
Explain the impact of an increase in consumer spending on the production of
goods and services
How successful has the South African government been in improving the
quality of labour?
Activity 5
5.1
Briefly discuss poverty and trade as challenges of globalisation.
5.2
Differentiate between economic growth and economic development.
5.3
How can the Expanded Public Work Programmes be used to reduce the
unemployment rate?
(1)
(1)
(2)
(2)
(4)
(8)
(8)
(8)
Activity 5: Essays
5.1 Discuss in detail the South African growth and development policies
(26)
Activity 6
6.1
Discuss in detail the demand-side approach in promoting growth and development
in South Africa.
(26)
Page 30 of 61
Activity 9
9.2
Study the extract below and answer the questions that follow:
www.statsa.co.za
9.2.1
Identify one IDZ from Kwazulu Natal in the above extract.
(1)
9.2.2
Name the IDZ that has created most jobs in the extract above.
(1)
9.2.3
Briefly describe the term corridor.
(2)
9.2.4
How can the government encourage business to use the IDZ.
(2)
9.2.5 How can the South Africa benefit from value added production?
(4)
10.2
Study the extract below and answer the questions that follow:
www.statsa.co.za
Page 31 of 61
10.2.1 Name the SEZ identified for the Limpopo province
(1)
10.2.2 Identify the main focus of the proposed Mpumalanga SEZ.
(1)
10.2.3 Briefly describe the term industrial development zone.
(2)
10.2.4 Why are SEZ seen as an improvement on IDZ.
(2)
10.2.5 How can the South African government achieve a high level of industrial development?
(4)
Activity 11
11.1
Study the extract below and answer the questions that follow
The revised Industrial Policy Action Plan (IPAP2) is a radical shift to grow a developmental economy
by taking a deliberate decision to ensure that investment targets production sectors of the economy to
arrest the decline in manufacturing and accelerate employment creation. IPAP2 clearly is an attempt
by Government to arrest industrial decline and place South Africa on a new growth path. Within the
context of a new growth path, IPAP2 focuses on value-added sectors with the potential for high
employment creation and growth multipliers.
The key challenge to industrial policy is to incentivize investment in plant, technologies and skills that
would have medium to long term benefits to the economy, but which the market would screen out
because there is lower hanging fruit for short term returns. Industrial investment in targeted
technologies and sectors spills over to the rest of the economy, resulting in generalised productivity
improvement and increased welfare.
Industrial policy has traditionally placed a strong emphasis on the manufacturing sector, precisely
because of such spill-over effects, and in terms of production disciplines, the mastery of new
technologies and ultimately design capabilities. However, the boundary between what were historically
considered primary sectors, such as mining and agriculture, and manufacturing industries and the
services sectors, is becoming increasingly blurred.
Source: www.citypress.co.za
11.1.1
11.1.2
11.2.3
11.2.4
11.2.5
Name the South African Industrial development policy in the extract above.
Name one benefit of increased investment in industrial development.
Briefly describe the term Integrated Manufacturing Strategy (IMS).
How can tax incentives be used to promote industrial development?
How can IPAP benefit the economy besides job creation?
(1)
(1)
(2)
(2)
(4)
Page 32 of 61
12.1
STUDY THE EXTRACT BELOW AND ANSWER THE QUESTION THAT FOLLOWS:
Integrated Manufacturing Strategy
Dr Alistair Ruiters, DTI Director General, conducted the presentation on the integrated
manufacturing strategy and Members raised the following concerns with the Department of
Trade and Industry presentation on the Integrated Manufacturing Strategy (IMS): the efforts of
the IMS to alleviate poverty and create employment, the fact that the export-led approach of the
economy does not actually create employment and the Department was asked to explain its
plans to guard against the current "brain drain".
During the discussion on the NSTF/NACI presentation on the Growth and Innovation Study the
Committee sought clarity on the manner in which the study would alleviate poverty, and
NSTF/NACI was asked to give its recommendations aimed at addressing the problem of the
low rate of production of Mathematics and Science graduates.
Source: www.blommberg.com
12.1.1 Identify the regional development strategy in the extract above.
12.1.2 Name one socioeconomic challenge that the IMS seeks to solve.
(1)
(1)
12.1.3 Briefly describe the term Industrial Development.
(2)
12.1.4 What economic benefits will the implementation of the IMS have
on the south African economy.
(2)
12.1.5 How can the government encourage industrial development in South Africa?
13.1
(4)
Study the extract below and answer the question that follow:
SOUTH AFRICAN INDUSTRIAL DEVELOPMENT
The cornerstone of South Africa's industrial policy is an elaborate system of investment incentives. “One
of the most effective DTI contributions in support of broadening economic participation, inclusive growth
and job creation has been its continuous provision of incentive packages as well as developing different
policy initiatives to foster industrial development.
The primary objective of the National Industrial Policy Framework (NIPF) is to set out government's
approach to the industrial development of the South African economy. Consequently, the NIPF sets out
a vision for the industrial economy for both the short-medium and medium-long term.
Source: www.statssa.ca.za
13.1.1 Identify one objective of industrial development in the extract above.
(1)
Page 33 of 61
13.1.2 Name the industrial development policy mentioned in the extract above.
13.1.3 Briefly describe the term foreign investment grant.
13.1.4. Why should the South African economy focus on value added production?
13.1.5 How can South Africa ensure the survival of labour intensive manufacturing industries .
14.1
(1)
(2)
(2)
(4)
Study the cartoon below and answer the questions that follow:
Source: www.printre.com
14.1.1 Identify the characteristic associated with the North – South Divide in the cartoon above.
14.1.2 Name one South Africa’s regional development endeavours.
14.1.3 Briefly describe the term regional development.
14.1.4 Why is regional development important for the economy?
14.1.5 How do corridors contribute to regional development.
(1)
(1)
(2)
(2)
(4)
Page 34 of 61
PAPER 2 TOPICS
PERFECT MARKETS
ACTIVITY 1
1.1
Various options are provided as possible answers to the following questions. Choose the
correct answer and write only the letter (A-D) next to the question number (1.1.1-1.1.4)
in the ANSWER BOOK, for example 1.1.5. D
1.1.1
A
B
C
D
An equilibrium position where total revenue is greater than total cost is known as……
economic loss
economic profit
artificial profit
normal profit
1.1.2
The value of input used in the production process that an entrepreneur had to hire or purchase.
A
B
C
D
variable cost
sunk cost
implicit cost
explicit cost
1.1.3
A
B
C
D
A long run situation where the average revenue is equal to average cost is called……..
economic profit
economic loss
normal profit
maximised profit.
1.1.4
A
B
C
D
The MC part above the shutdown point in a perfect market is known as…….
average revenue curve
demand curve
supply curve
marginal revenue curve
(2x4)
1.2
1.2.1
1.2.2
1.2.3
(8)
Match the concepts in column A to description in column B. Write only the correct letter
next to the question number .e.g (1.2.9 J).
COLUMN A
COLUMN B
Break-even point
A
Authorises and prohibits large mergers and takeovers
Competition Tribunal
B
Period of production where all factors of production
become variable
Long run
C
Actual expenditure on hired inputs that a business
incurs in the production process, e.g., wages and
interest
Page 35 of 61
1.2.4
Explicit costs
D
1.2.5
Economic profit
E
1.2.6
Implicit cost
F
1.2.7
Normal profit
G
1.2.8
Sunk cost
H
I
1.3
1.3.1
1.3.2
1.3.3
1.3.4
1.3.5
1.3.6
1.3.7
1.3.8
The total costs of production are equal to the total
revenue received by the firm
Period of production where one of the production
factors is fixed
The minimum earning required to prevent an
entrepreneur from leaving the market.
The value of input used in the production process that
are owned by an entrepreneur
A positive difference between the total revenue and
total cost
The capital that was invested in a business and cannot
be recovered if the business closes
Give ONE term for each of the following descriptions. Write only the term next to the question
numbers (1.3.1 to 1.3.4) in the ANSWER BOOK. Abbreviations, acronyms, and examples will
NOT be accepted
The point in production below which a firm's revenue is not able to meet its average variable
costs.
The cost that remains the same even if the output changes.
A market structure where the individual firms are price-takers.
The additional revenue earned when sales increase by one more unit.
Costs per unit that changes with the volume of output produced by a firm.
The economic production period where only variable costs can change.
Products which are similar in nature.
Sum of all individual businesses producing a similar kind of products.
ACTIVITY 2
2.1
Study the diagram below and answer the questions that follow.
Source: stock-market-cartoon1
Page 36 of 61
2.1.1
2.1.2
2.1.3
2.1.4
2.1.5
Identify the market structure shown by the cartoon above.
Name any one example of a perfect competition
Briefly describe the term fixed cost
(2)
Explain the effect of freedom of entry in the perfect market in the long run.
Why is a perfectly competitive firm unable to influence its price?
(1)
(1)
(2)
(4)
ACTIVITY 3
3.1
Study the illustration bellow and answer the questions that follow
The assumption of free entry implies that if there are firms earning excessively high profits during a short-run
period in a given industry, new firms that also seek a high profit are likely to start to produce or change into a
production of the same good to join the market.
Source:istockphoto
3.1.1
What period of production is depicted by the picture above in a perfect market?
(1)
3.1.2
Identify the economic characteristic shown in the cartoon above.
(1)
3.1.3
Briefly describe the term long-run.
(2)
3.1.4
Explain the effect of an increase in the number of participants in the market price.
(2)
3.1.5
How can a perfectly competitive firm increase its profits?
(4)
Page 37 of 61
4.1
Study the graph below and answer the questions that follows
X
PRICE
AC
A
15
B
12
AVC
MR/AR/DD
C
250
4.1.1
4.1.2
4.1.3
4.1.4
4.1.5
QUANTITY
Identify the curve marked X in the diagram above.
What is represented by the shaded area?
Briefly describe the term marginal revenue.
Explain the reason for the firm not to produce below point C.
Why is the portion above point C in curve X significant in this market?
(1)
(1)
(2)
(2)
(4)
ACTIVITY 5
5.1
Study the graph below and answer the questions that follow.
5.1.1
5.1.2
5.1.3
5.1.4
5.1.5
Identify the quantity the firm will produce at equilibrium point.
Which curve represents the market price for the perfect competitor?
Briefly describe the term normal profit
What would be the impact on the market if many firms leave this industry?
Why must marginal cost be equal to marginal revenue for the profit to be maximized?
(1)
(1)
(2)
(2)
(4)
Page 38 of 61
ACTIVITY 6
6.1
Study the graph below and answer the questions that follow.
6.1.1
How many units are produced by the perfect competitor in the short run?
(1)
6.1.2
6.1.3
6.1.4
Identify the price where the individual producer will make an economic profit
Briefly describe the term marginal cost.
Why is the marginal revenue curve (MR) the same as the demand curve in the perfect
market?
How is the long-run equilibrium achieved in the above market?
(1)
(2)
6.1.5
ACTIVITY 7
7.1
With the aid of a diagram explain how profit maximisation is achieved using MR/MC rule.
7.2
Briefly explain market information and collusion as characteristics of perfect market.
7.3
Explain the aims of South Africa's anti-monopolistic policy.
7.4
Use a graph of total cost (TC) and total revenue (TR) to explain profit maximization
in a perfect market.
7.5
With the aid of a well-labelled graph (cost and revenue curves), explain the shut-down
point for the individual firm in a perfect market
(2)
(4)
(8)
(8)
(8)
(8)
(8)
ACTIVITY 8
With the aid of three separate graphs, explain the following equilibrium positions in a perfect market:



Economic profit
Economic loss
Normal profit
How successful is the competition policy in promoting a more competitive economy
(10)
(8)
(8)
(26)
(10)
Page 39 of 61
MONOPOLY
Activity 1
MULTIPLE CHOICE QUESTIONS AND ANSWERS
1.1.1 Selling unique product is a characteristic of a/an … market.
A. oligopolistic
B. monopolist
C. monopolistic competition
D. perfect
(2)
1.1.2 Monopoly is also known as an _______
(2)
A. industry
B. market
C. firm
D. monopolistic
1.1.3 A monopolist will be earning maximum profits when…...
A. TR = TC
B. TR < TC
C. TR > TC
D. When difference between TR & TC is at maximum
(2)
1.1.4 A monopolist will be at equilibrium where………
(2)
A. MR =MC and MC curve cuts MR from below
B. MR >MC
C. MR =MC
D. MR < MC
1.1.5 Monopolies will realise a/an … profit in the long run.
A. economic
B. normal
C. subnormal
D. equal
(2)
(2 x 5 = 10)
Page 40 of 61
1.2
Choose a description from COLUMN B that matches an item in COLUMN A.
Choose a description from COLUMN B that matches an item in COLUMN A.
COLUMN A
COLUMN B
1.2.1
Price Maker
A. The exclusive right to manufacture a product.
1.2.2
Long-run
B. Situation where the business does not make a profit or a loss
1.2.3
Monopoly
C. Where barriers to entry are not of an economic nature.
1.2.4
Patent
D. A market structure where only one seller operates.
1.2.5
Artificial Monopoly
E. When a firm has power to charge any price for its product.
F. A Period where all factor inputs can be varied.
(1 x 5)
1.3
1.3.1
1.3.2
1.3.3
1.3.4
1.3.5
Give ONE term for each of the following descriptions.
The profit that the monopoly firm make both in long run and short run.
The legal right whereby the holder obtains the exclusive right to manufacture a product.
A monopoly that exists because of high development costs.
A market structure where entry and exit is completely blocked.
A point where MC equals MR yet the business is making an economic loss.
(1 x 5 = 5)
Question 2
2.1.1 Name two types of monopoly
2.1.2 How are artificial monopolies protected from competition?
(2)
(2)
2.2 Study the carton below and answer the questions that follow.
2.2.1
2.2.2
2.2.3
2.2.4
2.2.5
Which market structure is depicted in the above carton?
Name a characteristic of a market structure above.
Briefly describe the concept monopoly.
Explain how monopolies set their market prices.
Why do monopolies make economic profit in the long run?
(1)
(1)
(2)
(2)
(4)
Page 41 of 61
Question 3
3.1.1 List any Two examples of sunk costs.
3.1.2 How do prices of monopolies affect consumers?
(2)
(2)
3.2 Study the carton below and answer the questions that follow.
3.2.1
3.2.
3.2.3
3.2.4
3.2.5
Identify the company that supplies electricity in South Africa?
Which organization is regulating the supply of electricity in South Africa?
Briefly describe the term natural monopoly.
How does profit maximization occur in a monopoly?
How does government intervention limit entry in a monopoly?
Question 4
4.1.1 Name any Two barriers to entry of monopolies.
4.1.2 Why a Monopolist firm called a price maker?
(1)
(1)
(2)
(2)
(4)
(2)
(2)
4.2 Study the carton below and answer the questions that follow.
4.2.1
4.2.2
4.2.3
4.2.4
4.2.5
Identify the number of sellers in above markets structure.
What is preventing prospective suppliers from entering the market?
Describe the term profit maximization.
Briefly explain the nature of a product sold in the above market structure.
Explain what prevents monopolies from charging excessive higher prices.
(1)
(1)
(2)
(2)
(4)
Page 42 of 61
Question 5
5.1.1 Name any Two examples of monopoly in South Africa.
5.1.2 Why are Monopolies regarded as inefficient?
(2)
(2)
5.2
Study the following information and answer the following information.
5.2.1
5.2.2
5.2.3
5.2.4
(1)
(1)
(2)
5.2.5
5.3
Identify the point on the graph that indicates optimum production
Provide another alternative name for AR curve.
Briefly describe the term deadweight loss.
Explain why the marginal revenue curve (MR) will always lie below the average revenue
curve (AR)
Calculate the profit or loss of this market. Show ALL calculations.
Draw a fully labelled graph to illustrate economic profit for a monopolist in the short run.
5.4
5.5
5.6
5.7
Distinguish between artificial and natural monopoly
Explain why the monopolist makes economic profit in the long run
How does the inefficiency occur in a monopoly?
With the aid of graphs explain how total revenue is maximized in a monopoly.
(8)
(8)
(8)
(8)
(2)
(4)
(8)
ACTIVITY 6
Discuss in detail the characteristics of a monopoly.
(26)
With the aid of graphs, discuss how economic profit and economic loss is determined in a monopoly
market. (26)
Evaluate the effects of natural monopolies on an economy.
(10)
With the aid of a well labelled graph explain the long-run equilibrium of a monopoly
(10)
Page 43 of 61
MONOPOLISTIC COMPETITION
Activity 1
1.1 Study the picture below and answer the questions that follows
1.1.1
1.1.2
1.1.3
1.1.4
1.1.5
Identify one non price competition strategy used by a monopolistic competitor.
Name the nature of product sold in the market structure above.
Briefly describe the term.
Why is product differentiation important for a monopolistic competition?
How does the monopolistic competition benefit consumers?
(1)
(1)
(2)
(2)
(4)
Activity 2
2.1 Study the picture below and answer the questions that follows:
2.1.1
2.1.2
2.1.3
2.1.4
2.1.5
Name the characteristic of a monopolistic competitor from the above picture
What is the nature of the demand curve of a monopolistic competitor
Briefly describe the term branding.
Why is branding is an important non price competition strategy for the monopolistic
competitor?
How can a monopolistic competitive firm increase its market share?
(1)
(1)
(2)
(2)
(4)
Page 44 of 61
Activity 3
3.1
Study the information below and answer the questions that follow:
3.1.1
3.1.2
3.1.3
3.1.4
3.1.5
Identify the market structure represented in the above picture
What is the nature of the product sold in this market above?
Briefly describe the term hybrid structure.
Why monopolistic competitive firms earn zero economic profits in the long run?
How does the free entry affect the demand curve of the monopolistic competition?
(1)
(1)
(2)
(2)
(4)
Activity 4
4.1
Study the extract below and answer the questions that follow.
4.1.1
4.1.2
4.1.3
4.1.4
4.1.5
4.2
4.3
4.3
4.4
Give ONE example of a monopolistic competitor that specialises only in chicken
Identify the concept that describes a combination of perfect competition and monopoly.
Briefly describe the term product differentiation
Give a reason why businesses in the monopolistic competitive market prefer to compete
on a non-price basis.
Why will the economic profit made by a monopolistic competitor disappear in the
long run?
How can monopolistic competitors use market research and product development as
non-price strategies?
How does differentiated products influence consumer choices?
Examine the importance of branding and advertising in a monopolistic competitive
industry.
(1)
(1)
(2)
(2)
(4)
(8)
(8)
(8)
Page 45 of 61
OLIGOPOLY
Activity 1
1.1.
Various options are provided as possible answers to the following questions. Choose the
answer and write only the letter (A-D) next to the question number 1.1.1 – 1.1.5. In the
ANSWER BOOK. For example 1.1.6. A
1.1.1
The Industry characterized by few large firms is called…..
A.
perfect market
B.
oligopoly
C.
monopolistic competition
D.
duopoly
1.1.2
Firms spend lot of money establishing brand loyalty with existing customers and attract new
customers
A.
loyalty schemes
B.
product development
C.
advertising
D.
packaging
1.1.3
Which of the following is not an example of oligopoly market
A.
bread and milk industry
B.
restaurants
C.
fertilizer industry
D.
car industry
1.1.4
When one firm changes price and the other follow it is regarded as ……………….
A.
discrimination
B.
differentiation
C.
price leadership
D.
influence
1.1.5
Collusion is an agreement among firms to ……………..competition
A.
limit
B.
promote
C.
match
D.
regulate
1.1.6
The demand curve that explains oligopolistic behaviour is described by some theories
as……………
A.
downward sloping
B.
kinked
C.
horizontal
D.
diagonal
Page 46 of 61
1.1.7
This exist when one or more firms has a significant control in the entire market
A.
market differentiation
B.
collusion
C.
market dominance
D.
market failure
1.1.8
Method of building customers loyalty by setting a product apart from that of competitors
A.
branding
B.
price leadership
C.
patents
D.
licensing
1.2
Choose a description from column B that best describe column A. Write only the letter (A – F)
next to the question number (1.2.1. – 1.2.5) Example 1.2.6. H
COLUMN A
1.2.1
1.2.2
Implicit collusion
1.2.3
Cartel
1.2.4
1.2.5
1.3
1.3.1
1.3.2
1.3.3
1.3.4
1.3.5
Duopoly
Differentiated
oligopoly
Non price
competition
COLUMN B
A. Behavior by firms is motivated by an arrangement that
is not formal
B. Agreement between oligopolies occurs openly and
formally
C. Market dominated with differentiated product
D. Marketing strategy in which one firm tries to
distinguish its product
E. There are two markets that dominates the industry
F. A strategy of competing without using the price
Give one term for each of the following descriptions. Write only the term next to the question
number (1.3.1. – 1.3.5)
Oligopoly producing many range of products to cater for many different market
One business in the industry makes price decision on behalf of the other producers
Market structure characterized by few large firms that sell homogenous product
An arrangement between businesses with the aim of limiting competition amongst themselves
Products are made to be slightly different in terms of physical appearance
Activity 2
2.1.1 Name any two examples of oligopoly market.
2.1.2 Why oligopoly firms turn to collude?
(2)
(2)
Page 47 of 61
2.2. Study the picture below and answer questions that follow
Source: www.investopedia.com
2.2.1
2.2.2
2.2.3
2.2.4
2.2.5
2.3
2.4
Name the form of collusion illustrated by the cartoon above
Which market structure is depicted by the cartoon above?
Briefly describe the term pure oligopoly.
How can collusion negatively affect producers?
How could markets in oligopoly increase their market share?
Differentiate between explicit collusion and implicit collusion
How could government discourage firms from colluding
(1)
(1)
(2)
(2)
(8)
(8)
(8)
Activity 3
3.1.1 Name two forms of collusion
3.1.2 Why is it difficult for oligopolies to adjust the price
3.2
(2)
(2)
Study the picture and answer the questions that follow.
As wireless telecommunications companies ramp up their 5G rollout, they are beginning to pull the plug
on their 3G network.2022 is the end of the line for the venerable cellphone service.
Source: www.cartoonstock.com
3.2.1
3.2.2
3.2.3
3.2.4
Which industry is represented by the above illustration
Name one barrier to entry in this market structure
Briefly describe the term non price competition
Why is the market characterized by mutual dependence?
(1)
(1)
(2)
(2)
Page 48 of 61
3.2.5
3.3
3.4
How do barriers of entry negatively affect consumers?
With the aid of a relevant graph, explain the demand curve faced by oligopolies
How does non price strategy positively impact oligopolies?
(4)
(8)
(8)
ACTIVITY 4
4.1 Study the graph below and answer the questions that follow
4.1.1
4.1.2
(1)
4.1.3
4.1.4
4.1.5
Name the market structure that is represented by the above graph
Identify the market price on the graph above
(1)
Briefly describe the term price leadership
Why would a firm be reluctant to increase prices in an oligopolists market?
Calculate total revenue earned by this firm. Show all your calculations.
4.2
4.3.
Compare similarities of oligopoly with those of monopolistic competition
Why the demand curve of this firm has two segments?
(8)
(8)
(2)
(2)
(4)
ACTIVITY 5
5.2.
Study the extract below and answer the questions that follow.
Three South African banks have been implicated among 17 banking groups in ‘widespread’
collusion relating to the price fixing of the rand.
Following an almost two-year investigation into the matter, the Competition Commission has now
referred a collusion case to the Competition Tribunal for prosecution.
According to the Competition Commission, it has been investigating the matter since April 2015 √
Source:https://businesstech.co.za/news/banking
5.2.1
5.2.2
Name the type of collusion found in the extract above.
Who determines the price in this market structure?
(1)
(1)
Page 49 of 61
5.2.3
5.2.4
5.2.5
5.4.1
5.4.3
Briefly describe the term cartel.
Explain why oligopolies make economic profit in the long run.
How can a firm under oligopoly increase its market share?
Discuss the number of businesses and decision making as characteristics in an
oligopoly.
How firms under oligopoly can use non-price competition strategies to prevent
price wars.
(2)
(2)
(4)
(8)
(8)
MARKET FAILURE
ACTIVITY 1
1.1
Various questions are provided as possible answers to the following questions. Choose the
correct answer and write only the letter (A. – D.) next to the question number (1.1.1 -1.1.5) in
the answer book, for example 1.1.6 B.
1.1.1 Reduction in economic welfare caused by a reduction in both consumer and producer surplus.
A.
dead weight loss
B.
spill over effect
C.
allocative inefficiency
D.
productive inefficiency
1.1.2
Price set by the government above market price to benefit businesses is the price….
A.
floors
B.
ceiling
C.
wars
D.
Administration.
1.1.3.
The effects of an economic activity on the people which are not included in the activity……
Cost or benefits to third parties not included in the market price are called…
A.
efficiencies.
B.
externalities.
C.
excludabilities.
D.
information
1.1.4
Social cost consists of the sum of private and ….cost
A.
internal
B.
public
C.
external
D.
variable
1.1.5
The effect of a minimum price will increase the…. goods
A.
demand for
B.
supply
C.
consumption of
D.
spending on
Page 50 of 61
1.2 Choose a description from COLUMN B that matches the item in COLUMN A
COLUMN A
COLUMN B
1.2.1 Progressive taxation
A. A market that sells illegal goods.
1.2.2 Free riders
B. Goods that are harmful to the society.
1.2.3 Pareto efficiency
C. The system of taxation used in South Africa.
1.2.4 Black market
D. Prices that a set by the government above the market price.
1.2.5 Demerit goods
E. When cost of production is high and incorrect quantity of
goods are produced.
F. A situation where it is impossible to make someone better off
without making someone else worse off.
G. The loss of potential gain from other alternatives when one
alternative is chosen.
H. People who benefit from consuming the product/service
without paying for it.
I. The wages that are set by the government above market
Prices
J. Money received without any service rendered
1.2.6 Transfer payment
1.2.7 Inefficiency
1.2.8 Price floor
1.2.9 Discounting
1.2.10 Opportunity cost
K. Reducing all future cost and benefit to express them as
present value.
1.3.1
1.3.2
1.3.3.
1.3.4.
1.3.5
The best estimate of a price something that is not part of a normal market.
Consumption of goods by one person does not reduce consumption by others.
A method of evaluating and comparing the social cost and social benefit of a project
Financial support by the government to assist the production of a good and services
The additional costs to society of external factors
(1)
(1)
(1)
(1)
(1)
ACTIVITY 2
2.1 Study the information below and answer the questions that follow.
2.1.1
2.1.2
2.1.3
2.1.4
2.1.5
Identify the type of negative externality depicted by the picture above.
Name ONE method used by government to reduce negative externalities.
Describe the term negative externality.
Explain how demerit goods cause market failure
Why would the government intervene in the operation of markets?
(1)
(1)
(2)
(2)
(4)
Page 51 of 61
ACTIVITY 3
3.1
Study the pictures below and answer the question that follow.
Source: www.investopedia.com
3.1.1
3.1.2
3.1.3
3.1.4
3.1.5
What type of inefficiency is evident in the illustrations above?
What will happen when supply is less than demand?
Briefly describe the concept productive inefficiency.
Explain the effect on price if there are shortages in the market.
How can subsidies be used to solve the market failure?
(1)
(1)
(2)
(2)
2×2 = (4)
ACTIVITY 4
4.1
Study the Graph below and answer the question that follow.
4.1.1
4.1.2
What is the maximum price in the graph above?
Identify the quantity of goods which will be supplied if a maximum price of R70 is
implemented.
Briefly describe the term market failure.
Why will the government implement maximum prices on certain goods?
Explain the impact of maximum prices on the market.
4.1.3
4.1.4
4.1.5
(1)
(1)
(2)
(2)
(4)
Page 52 of 61
ACTIVITY 5
5.1
Study the picture and answer the questions that follow.
MINIMUM WAGE INCREASE
The legislation stipulates a minimum national rate of R20 per hour, or R3 500 per
month, depending on the number of hours worked. The R20 an hour rate will be
phased in slowly in the agriculture and domestic work sectors with workers
earning R18 and R15 respectively.
[Source https:mywage.co.za]
5.1.1
Which Department is implementing minimum wage?
(1)
5.1.2
When did the national minimum wage come into effect?
(1)
5.1.3
Briefly describe the term minimum wage.
(2)
5.1.4
How would workers benefit from minimum wages?
(2)
5.1.5
How successful has the government been in redistributing wealth?
(4)
ACTIVITY 6
6.1
6.2
Briefly discuss productive inefficiency and allocative inefficiency in terms of market
failure.
(8)
Use the graph below to explain the effects of the positive externalities in the market.
(8)
ACTIVITY 7
7.1
Evaluate the success of the South African government intervention to discourage the
consumption of demerit goods.
7.2
(8)
Explain why governments sometimes proceed with a project even if the private costs
exceed the private benefits in a cost-benefit analysis
(8)
ACTIVITY 8
•Discuss in detail, without the graphs, causes of market failure
(26)
•Evaluate the use of indirect taxation to solve market failure
(10)
Page 53 of 61
CONTEMPORARY ECONOMIC ISSUES:
INFLATION
Activity 1
Answer the following questions
1.1.1 These are prices of goods and services that are set and controlled by government….
A.
administered prices.
B.
consumer price index.
C.
producer price index.
D.
price discrimination.
1.1.2
the inflation that measures the unadjusted CPI figures is called …inflation
A.
stagflation
B.
headline
C.
hyper
D.
all-inclusive
1.1.3
This indicator that measures increases in the cost of production is...
A.
GDP Deflector.
B.
CPIX.
C.
producer price index.
D.
consumer price index.
1.1.4. When prices of goods and services decrease continuously over a long period of time.
A.
cost -push inflation
B.
deflation
C.
hyper
D.
demand pull inflation
1.1.5 Rate in which commercial banks lend money to their potential clients is…
A.
interest rate.
B.
repo rate.
C.
prime rate.
D.
inflation rate.
(5X2)10
Page 54 of 61
1.2.
Choose a description from COLUMN B that matches the item in COLUMN A.
Write only the letter (A-I) next to the question numbers (1.2.1. to 1.2.5) in the ANSWER BOOK.
COLUMN A
COLUMN B
1.2.1.
Constant prices
A.
Increase in salaries that results in workers paying a higher
income tax rate.
1.2.2.
Bracket creep
B.
Excludes items from the CPI basket that show high price
volatility.
1.2.3.
All-inclusive inflation
C.
Takes into account the effects of inflation on gross
domestic product.
1.2.4.
Deflation
D.
Type of inflation where the aggregate demand for goods
and services exceeds the aggregate supply.
1.2.5.
Core inflation
E.
The ratio of GDP at current prices to the GDP at
constant prices for a specific year.
F.
Price of goods and services decrease continuously over a
long period of time.
(5x1)5
1.3
Give ONE term for EACH of the following descriptions. Write only the term next to the question
numbers (1.3.1. to 1.3.5.).
1.3.1 Condition of low growth, high unemployment and high rates of inflation.
(1)
1.3.2 Demand of goods and services are higher than supply.
(1)
1.3.3 A sustainable and significant increase in general price level over time.
(1)
1.3.4 An increase in price is caused by an increase in the cost of production
(1)
1.3.5 Situation where prices rise so rapidly that people lose confidence.
(1)
Activity 2
Answer the following questions
2.1.1 Name two instrument of fiscal policy use to combat inflation
2.1.2 Why would high inflation lead to retrenchment in the workplace?
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2.2.
Study the cartoon below and answer the questions that follow
A RISING TIDE LIFTS ALL BOATS
Petrol prices becoming a challenge to South African economy, price hikes see SA consumers buying less-and doing all their shopping under one roof.
Annual consumer price inflation quickened to 6,5% in May 2022 from 5.9%in April 2022 and March 2022.
(source:http//economicshelp.org)
2.2.1
2.2.2
2.2.3
2.2.4
2.2.5
Identify the type of inflation associated with the increase in fuel prices in the above
cartoon.
Name ONE method to measured inflation.
Briefly describe the term stagflation.
Explain the importance of measuring inflation.
Why is high inflation a concern for business performance?
2.3
Study the cartoon below and answer the questions that follow.
2.3.1
2.3.2
2.3.3
2.3.4
2.3.5
Identify the month where SA inflation rate was above the target range.
Which type of inflation excludes items with high volatile prices?
Briefly describe the term headline inflation.
Explain the impact of increase in inflation rate on investors.
Examine the role of price expectation on inflation in South Africa
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(1)
(2)
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(4)
(1)
(1)
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Activity 3
Answer the following questions
3.1.1
Name any two examples of product or services with administered prices inflation.
(2)
3.1.2
What could be the contributing factor for high rates of inflation in South Africa?
(2)
3.2
Study the Graph below and answer the questions that follow
3.2.1
3.2.2
3.1.3
3.1.4
3.1.5
Name one example of supply shock as cause of cost push.
Which group of people that are mostly affected by high inflation?
Briefly describe the term inflation
Explain the effect of an increase in interest rates on inflation.
How can high inflation affect the supply and demand for bonds?
(1)
(1)
(2)
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(4)
Activity 4
4.1
Study the article below and answer the question that follow
SOUTH AFRICA INFLATION ACCELERATE IN FEW MONTHS.
The annual inflation rate in South Africa quickened to 7.4% in June of 2022, from 6.5% in May, above
market expectations of 7.2% and breaking through the upper limit of the South African Reserve Bank’s
target range of 3%-6%. It was the highest reading since May of 2009. continued. The annual core
inflation, which excludes prices of food, non-alcoholic beverages, fuel and energy, rose to 4.4% in June,
the highest since March of 2019, from 4.1% in the prior month.
source: Statistics South Africa
4.1.1
4.1.2
4.1.3
Name the South African institution responsible for combatting inflation?
Which school of thought believes that inflation is influenced by the total money supply?
Briefly describe the term hyperinflation.
(2)
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4.1.4
4.1.5
How would the cost of imported key inputs contribute to a higher inflation rate?
Why is a monetary policy effective in reducing demand-pull inflation?
(2)
(4)
4.2
4.3
Discuss the monetarists’ explanation of inflation.
Evaluate the impact of inflation targeting in South Africa.
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(8)
ENVIRONMENTAL SUSTAINABILITY
ACTIVITY 1
1.1
Various options are provided as possible answers to the following questions. Choose the
answer and write only the letter (A-D) next to the question numbers (1.1.1 to 1.1.5).
1.1.1
Using natural resources in a way that does not compromise their use by future generations is
known as ...
A
endangered species.
B
natural resources.
C
deforestation.
D
sustainable development.
1.1.2
When the earth’s temperature rises as a result of greenhouse gases is ….
A
global warming.
B
climate change.
C
pollution.
D
ozone layer.
1.1.3
Dumping of waste material on the soil is known called ... pollution.
A
land
B
water
C
air
D
noise
1.1.4
An agreement that was signed to control trans-boundary movement of hazardous waste is
called...
A
Basel Convention.
B
United Nations Framework.
C
Rotterdam Convention.
D
Kyoto Protocol.
(
4x2)
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1.2
Choose a description from COLUMN B that matches the item in COLUMN A. Write only the
letter (A-I) next to the question numbers (1.2.1 to 1.2.8).
COLUMN A
1.1.1 Marketable permits
1.1.2 Climate change
1.1.3 Deforestation
1.1.4 Biodiversity
1.1.5 Noise pollution
1.1.6 Indigenous
knowledge
1.1.7 Green taxes
1.1.8 Renewable
resources
1.3
1.3.1
1.3.2
1.3.3
1.3.4
1.3.5
COLUMN B
A. The number of species found within a specified region.
B. Resources that can be replaced or regenerated.
C. A licence to pollute issued to businesses .
D. Clearing an area of trees.
E. Unwanted sounds that disturb humans and other living organisms.
F. A change in weather patterns as a result of increase in carbon
dioxide in the atmosphere.
G. Levied on undesirable effects on environmental use.
H. Is passed on from generation to generation and can be used to
make a living.
I. A sustained use of natural resources without compromising the
needs of future generations.
(8x1) (8)
Give ONE term for each of the following descriptions. Write ONLY the term next to the question
number. Abbreviations, acronyms and examples will NOT be accepted.
Unusual change in weather patterns.
Environmentally friendly energies such as solar energy.
The wearing away of the land’s top layer due to water and wind.
Any strategy undertaken to safeguard the environment and maintain its current condition.
A place listed by United Nations Scientific and Cultural Organisation (UNESCO) as having
special cultural or physical significance
(5x1) (5)
ACTIVITY 2
2.1
Answer the following questions.
2.1.1
Name any TWO types of non-renewable energy sources.
(2)
2.1.2
Why do municipalities charge levies on rubbish collection?
(2)
2.2
Study the extract below and answer the questions that follow.
WHEN THE RAINS CAME
In the dead of night on 9 April 2022, rain started falling in KwaZulu-Natal and over the weekend, it
developed into roaring water and howling winds that ripped through homes.
By morning, those fortunate enough to survive the stormy weather woke up to destruction,
devastation and death. The torrential rains and resultant flooding killed at least 459 people, and
some 88 are still missing. A state of disaster was declared, and critical infrastructure suffered
damage that ran into billions.
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2.2.3
2.2.4
2.2.5
Briefly describe the term environmental subsidy.
Why is it important for the government to increase investments in storm water drains?
How does soil erosion contribute towards an ecological deficit?
ACTIVITY 2
2.1
Answer the following questions.
2.1.1 Name any TWO types of non-renewable energy sources.
2.1.2 Why do municipalities charge levies on rubbish collection?
2.2
(2)
(2)
(4)
(2)
(2)
Study the picture below and answer the questions that follow.
KWAZULU-NATAL RAINS, SOUTH AFRICA’S DEADLIEST IN DECADES
The country’s main freight group urged truck drivers to stay away from the harbour area, which it
described as “a disaster” because of damage to access roads, container yards, vehicles depots and
trucks.
Source: Mybroadband, 14 April 2022
2.2.1
Identify the environmental problem depicted by the picture above.
(1)
2.2.2
Mention an international measure that deals with global warming?
(1)
2.2.3
Briefly describe the term preservation.
(2)
2.2.4
What negative impact will the floods above have on Gross Domestic Product?
(2)
2.2.5
How can education improve the negative effects of pollution?
(4)
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ACTIVITY 3
3.1
Study the cartoon below and answer the questions that follow.
Source: politicalhumor.about.com
3.1.1
3.1.2
3.1.3
3.1.4
3.1.5
Identify the type of pollution that results into climate change.
State ONE natural world heritage site in South Africa.
Briefly describe the term desertification.
Explain why the market fails to address negative externalities.
Analyse the impact of recycling on the natural environment.
(1)
(1)
(2)
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(4)
3.2
Discuss levying of environmental tax and environmental subsidies as government
measures to ensure sustainable development.
How can government address the extinction of animals.
(8)
(8)
3.3
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