Economics Grade 10 KZN March Test 2026 Paper & Memo

EDUCATION REPUBLIC OF SOUTH AFRICA NATIONAL SENIOR CERTIFICATE gt BSSESSESSSSSSSSSSAS SR SSSR RREEE SSS E EEE EES te i sey hs ® ‘ shes 100 12 HOURS This question paper consists of 10 pages including this page. Copyright Reserved Please Tum Over

Econonfepwnloaded from Stanmorephysics.com PSA- Grade 10 March 2026 INSTRUCTIONS AND INFORMATION tt Answer THREE questions as follows: e SECTION A: COMPULSORY ® SECTION B: Answer any ONE question from this section. ® SECTION C: Answer any ONE of the two questions. 2. Answer ONLY the required number of questions. Answers in excess of the required number will NOT be marked. 3. Number the answers correctly according to the numbering system used in this question paper. 4. Read the questions carefully and start EACH question on. a new page. 5. Leave at least ONE line between subsectio 6. Answer questions in full sentences and ensure tl ) format, content and context of your responses complies with the cognitive requirements of the questions. a 7. Use ONLY blue or black ink. 8. Non-programmable pocket calculators may be used. 9. Write legibly and present your work neatly. Copyright Reserved Please Turn Over

Eccofpertnloaded from Stanmorephysics.com March 2026 PSA- Grade 10 SECTION A (COMPULSORY) QUESTION 1 20 MARKS - 10 MINUTES 1.1 Various options are provided as possible answers to the following questions. 1.44, Copyright Reserved Write down the question number (1.1.1 - 1.1.5) and write only letter (A - D) next to the question number in the ANSWER BOOK. The social science that studies how the society choose to use scarce resources to satisfy the unlimited needs and wants is called... A. sociology B. finance Cc. economics D. accounting Goods that are plentiful and has no exchange value.are known as ... goods A. free ze B. economic | P| Cc. public | D. capital a The simplified version of graphs and tables used as a representation of reality are referred to as... A. statistics B. mathematics C. drawings D. models The factors that originate from inside the business cycle are called...factors A. exogenous B. endogenous Cc. political D. external The market value ofall final goods and services produced by the permanent residents of a country is called ... A. Gross National Product (GNP) B. Gross Domestic Product (GDP) c. Gross National Income (GNI) D. Gross Domestic Expenditure (GDE) (5x2) (10) Please Turn Over

Economownloaded from Stanmorephysics.com PSA- Grade 10 March 2026 1.2 Choose a description from COLUMN B that matches an item in COLUMN A. Write ONLY the letter (A - G) next to the question number (1.2.1 — 1.2.6) in the ANSWER BOOK. COLUMN A COLUMN B 1.2.1Pollution ¢ 1.2.2 Scientific Method i 1.2.3 Capital intensive 1.24 Gross Domestic - Expenditure ! 1.2.5 Specialisation 1.2.6 Composite indicator The summary of all various indicators of the same type into a single value. Each worker performs a small part of the production activity. The contamination of the environment with dirty and harmful substances. The procedure of economics that formulate hypothesis by collecting data to conduct investigations. Spending that takes place inside the borders ofa country The method where Manual labour is used more than machines. The production method that uses more machine than labour. (6 x 1) (6) 1.3 Give ONE term each of the following descriptions. Write only the term next to the question number (1.3.1 - 1.3.4) in the ANSWER BOOK. ABBREVIATION AND ACRONYMS MAY NOT BE ACCEPTED. 1.3.1. The branch of economics that studies money and banking in the economy. 1.3.2 The type of tax that is used to discourage environmental damage. 1.3.3. Withdrawal of money from the circular flow. 1.3.4 The phase where there is a decrease of economic activities for at least two consecutive quarters. stanmorephysics.com Copyright Reserved (4 x 1) (4) TOTAL SECTION A: [20] Please Turn Over

Ecolawnloaded from Stanmorephysics.com March 2026 PSA- Grade 10 SECTION B Answer any ONE question of the TWO from this section in the ANSWER BOOK. QUESTION 2 40 MARKS -40 MINUTES 2.1 Answer the following questions. 2.1.1. Name any TWO factors of production (1x2) (2) 2.1.2. Why is the right to health care important for workers? (2x1) (2) 2.2 Study the information below and answer the questions that foliow Working to earn some money Going University to gét a degree Choice O21 Choice 62 Source: www.google.com 2.2.1 Identify the economic term that is depicted by the picture above. (1) 2.2.2 Name the basic economic problem that forces the consumers to make choice? (1) 2.2.3 Briefly describe the term absolute scarcity stanmorephysics.com (2) 2.2.4 Explain the importance of studying international economics to learners. (2) 2.2.5 How can economic goods benefit the businesses? (4) Copyright Reserved Please Tur Over

Econogwnloaded from Stanmorephysics.com PSA- Grade 10 March 2026 2.3 Study the information below answers the questions that follow. _ BASIC PROCESSES: EXCHANGE = SHEN SOURCE: WWW.G 2.3.1 Identify the economic sector that is shown by the above market. (1) 2.3.2 Name the tax that is imposed on goods that are bought from other countries. stanmorephysics.com (1) 2.3.3 Briefly describe the term consumption. (2) 2.3.4 Explain the role of the primary sector in the economy. (2) 2.3.5 How can the shortage of petrol affect producers? (4) 2.4 Differentiate between macroeconomics and microeconomics (8) 2.5 Howcan illegal mining negatively affect the South African economy? (8) Copyright Reserved Please Turn Over

E fe March 2026 ccéownloaded from Stanmorephysics.com QUESTION 3 40 MARKS -40 MINUTES 3.1 Answer the following questions 3.1.1. Name TWO types of flows in the circular flow (1x2) (2) 3.1.2 How can the public sector assist unemployed household? (2) 3.2 Study the information below and answer the questions that follow NATIONAL ACCOUNT AGGREGATES (2023) R million Primary sector 336 448 Secondary’sector 734 423 Tertiary sector GDP at basic prices Taxes on products , 100 745 Subsidies on products 108 906 GDP at market prices (A) Source: SARB Quarterly Bulletin 3.2.1 Identify the method of national account used in the table above. 3.2.2 Name any ONE industry that is found in the primary sector. 3.2.3 Briefly describe the term Gross domestic product. 3.2.4 Explain the importance of the secondary sector in the economy. 3.2.5 Calculate the Gross value added (GVA)at basic price (A). Copyright Reserved Please Turn Over (1) (1) (2) (2) (4)

EconomQownloaded from Stanmoreghysics.com a PSA- Grade 10 3.3. Study the information below and answer the questions that follow. + BUSINESS CYCLE a = = GS s g 5 S Ey Ss = 2 = = Time “| 3.3.1 Identify point B labelled from the above graph. j = (1) 3.3.2 Name the feature that measures the cistanae between peak and trend line. stanmorephysics.com (1) 3.3.3 Briefly describe the term trend line. (2) 3.3.4 Explain length as a feature to measure business cycle. (2) 3.3.5 How can leading indicators be used to predict the economic performance of the country? 3.4 Discuss the role of households in the circular flow. (8) 3.5 How can prosperity phase positively affect the economy? (8) TOTALSECTIONB: [40] Copyright Reserved Please Turn Over

ecokaunloaded from Stanmorephysics.com PSA- Grade 10 SECTION C March 2026 Answer any ONE of the two questions in this section in the ANSWER BOOK. Ensure that your answer follows the structure indicated below in order to obtain maximum marks: MARK STRUCTURE OF ESSAY ALLOCATION Introduction The introduction is a lower order-response Max. 2 e A good starting point would be to define the main concept related to the question topic. e Do notinclude any part of the question in your introduction. Do not include any part of the introduction in your body. e Avoid saying in the introduction what you are going to discuss in the body. Body ‘ ; Main part: Discuss in detail/ In depth discussion/ riticall Max. 26 discuss/ Analyse/ Compare/ Evaluate/ Distinguis' ° Additional part: Give own opinion/ Critically discus: faluate/ Critically evaluate/ Draw a graph and explain/ Use the graph g erthd explain/ Max. 10 Complete the given graph/ Calculate/ Deduce/ Compare/ Explain/ Distinguish/ Interpret/ Briefly debate/ How/ Suggest Conclusion Any high-order conclusion should include: Max. 2 e A brief summary of what has been discussed without repeating facts already mentioned. e Any opinion or value judgment on the facts discussed. Additional support information to strengthen the discussion/ analysis. e Acontradictory viewpoint with motivation, if required. Recommendations. TOTAL 40 QUESTION 4 40 MARKS -40 MINUTES e Discuss in detail the markets within the four-sector model. (26) e Howcan injections contribute to the South African economy? (10) [40] Copyright Reserved Please Turn Over

Downloaded from Stanmo Economics Copyright Reserved PSA- Grade 10 rephysics.com March 2026 40 MARKS -40 MINUTES es. (26) exogenous factor negatively impact on the economy? (10) [40] TOTAL MARKS: [100] fatimorephYsics.com

Downloaded from Stanmorephysics.com « KWAZULU-NATAL PROVINCE FINAL EDUCATION REPUBLIC OF SOUTH AFRICA NATIONAL SENIOR CERTIFICATE GRADE 10 MARKS: 100 This marking guidelines consists of 13 pages including this page. Copyright Reserved Please Turn Over

E ji ° Mi 2026 ="-"Sownloaded from Stenmaraphysigsiaaam aren SECTION A (COMPULSORY) QUESTION 1 20 MARKS-20 MINUTES 1.1 MULTIPLE-CHOICE QUESTIONS i C. economicsy ¥ 1.1.2. A. freevv 1.1.3. D. modelsv v 1.1.4. B. endogenous vv 1.1.5 A. Gross National Product (GNP) vv (5x2) (10) 1.2 MATCHING ITEMS 1.2.1 C. The contamination of the environment with dirty and harmful substances. ¥ j 1.2.2 D. The procedure of economics that formulate hypothe: to conduct investigations. Vv ‘ is by collecting data 1.2.3. G. The production method that uses more machine than labour. ¥ 1.2.4 E. Spending that takes place inside the borders of a countryY 1.2.5 B. Each worker performs a small part of the production activity. v 1.2.6 A. The summary of all various indicators of the same type into a single value. V (6 x 1) (6) 1.3. GIVE THE TERM 1.3.1. Monetary economicsY 1.3.2. Green taxY 1.3.3. LeakagesY 1.3.4. Recession” (4 x 1) (4) TOTAL SECTION A: [20] Copyright Reserved Please Turn Over

March 2026 “"""Sownloaded from Stanmazaphysigsaaam SECTION B Answer any ONE question of the TWO from this section in the ANSWER BOOK. QUESTION 2 MACROECONOMICS 40 MARKS-30 MARKS 2.1 SHORT QUESTIONS. 2.1.1 Name any TWO factors of production (1x2) (2) e Land / Natural resourcesY e Capital e LabourY e Entrepreneurshipy 2.1.2. Why is the right to health care important for workers? (2x1) (2) The healthy workers will improve productivity while earning more income to provide for their familiesY VW (Accept any other relevant correct answer) 2.2. DATARESPONSE 2.2.1 Identify the economic term that is depicted by the picture above. (1) Opportunity Cost” / Choice” 2.2.2. Name the basic economic problem that forces the consumers to make choice? (1) Scarcity of resources ¥ 2.2.3. Briefly describe the term absolute scarcity (2) Absolute scarcity occurs when resources,used to produce the products that are scarce in relation to high demand of that productv Vv (Accept any other relevant correct answer) 2.2.4 Explain the importance of studying international economics to learners. (2) e It helps learners to understand the relationship of the country with other countries in terms of trade and its financesv v e Learners will have better knowledge of the role played by exports and imports in the country. ¥¥ (Accept any other relevant correct answer) Copyright Reserved Please Turn Over

“"-"Kownloaded from Stemmaraphysiasiaaam Maren 20 2.2.5 How can economic goods benefit the businesses? (4) e Economic goods have the exchange value which means possession of economic goods create wealth for businesses VV e They are manmade thus their production will assist businesses create more employment. vv (Accept any other relevant correct answers) 2.3. DATA RESPONSE 2.3.1 Identify the economic sector that is shown by the above market. (1) Tertiary sectorY 2.3.2 Name the tax that is imposed on goods that are bought from other countries. (1) Import duties ¥ (Accept any other relevant correct answer) 2.3.3 Briefly describe the term consumption. (2) Consumption refers to the use of goods and services to satisfy needs and wants. Vv” (Accept any other relevant correct answer) \ 2.3.4 Explain the role of the primary sector in the economy. (2) e The primary sector industries extract raw material from nature to supply to secondary industries. v¥ e Unskilled workers find employment in the primary sector. VV e Primary sector products are exported to foreign countries in exchange for money. ¥¥ (Accept any other relevant correct answer) 2.3.5 How can the shortage of petrol affect producers? (4) e The shortage of petrol will increase the transport cost and businesses will lose profit. vv e Businesses that operate far from the production sites may fail to proceed as they cannot transport raw material or final goods to required destinationsv V¥ e Tertiary sector businesses like tourism depends on transport for their clients ,thus they may struggle to continue to offer services.v” (Accept any other relevant correct answer) Copyright Reserved Please Turn Over

“"-"Sownloaded from Stenmaraphysiasiaaam Maren 20 2.4 Differentiate between macroeconomics and microeconomics (8) Macroeconomics e_Is the study of the economy as a whole .v¥ e Examines the behaviour of society when factors like inflation and unemployment changes. Vv ¥ e It focuses on the overall economic performance than individual units. Vv“ Max 4 Microeconomics e_ The study of individual consumers, firms and other organisations. .”¥ e It focuses on specific economic units such as decision-making, supply and demand and resources allocation.v ” Max 4 (Accept any other relevant correct answer) 2.5 How can illegal mining negatively affect the South African economy? (8) e Minerals extracted by illicit miners will be sold in black market causing loss of profits.on legal businesses vv e Illegal mining contributes to economic instability and undermines investors’ confidence.v v e Environmental damage may take place where these miners leave open holes which increases the risk to local IpotmraCS "Properties and life. vv e The government revenue will be lost as these miners operate without paying taxes.v ¥ e Government spending may increase due to: aeridents that may occur to these participants in all cites. vv (Maximum 2 marks for mere listing of facts/examples) (Accept any other relevant correct answer) Copyright Reserved Please Turn Over

“"""Bownloaded from Stanmazaphysiasaaam March 2026 QUESTION 3 MACROECONOMICS 40 MARKS-30 MINUTES 3.1 SHORT QUESTIONS 3.1.1 Name TWO types of flows in the circular flow (1x2) (2) 3.1.2 3.2 3.2.1 3.2.2 3.2.3 3.2.4 e Real flows” e Money flowsY How can the public sector assist unemployed household? (2) «The public sector can give social grants to unemployed households so that they are able to satisfy their needs. VV e The public sector can provide public goods like free education for unemployed people to access skills that will give them better employment. v (Accept any other correct relevant answer) DATA RESPONSE Identify the method of national account used in the table above. (1) Production method. GDP (P) “ Name any ONE industry that is found in the primary sector. (1) MiningY FishingY e e ForestryY e Agriculture” (Accept any other relevant correct answer) Briefly describe the term Gross domestic product. (2) Gross domestic product refers to the market value of all final goods and services produced within the borders of a country for a specific period of time. VV (Accept any other relevant correct answer) Explain the importance of the secondary sector in the economy. (2) e Secondary sector manufacture/produce goods and services that satisfy the needs and wants of the people. Vv e Industries provide employment for the household which help them to earn income. VY e There is a high contribution to the GDP of the country which increases foreign exchange. VY (Accept any other relevant correct answer) Copyright Reserved Please Turn Over

“"-"Kownloaded from Stenmaraphysiasiaaam 3.2.5 3.3 3.3.1 3.3.2 3.3.3 3.3.4 3.3.5 March 2026 Calculate the Gross value added (GVA)at basic price (A) GVA at basic prices 4159696 v Plus taxes on product 100745 v Minus subsidies on product 108906 Vv GVA at market price 4151535 Vv DATA RESPONSE Identify point B labelled from the above graph. Peakv Name the feature that measures the distance between peak and trend line. Amplitudev Briefly describe the term trend line. The trend line shows the general direction of economy /economic potential of a country.v¥ ¥ pk A (Accept any other relevant correct answer) Explain length as a feature to measure business cycle. The length of a business cycle is measured from peak to peak or from trough to trough ¥v (Accept any other relevant correct answer) How can leading indicators be used to predict the economic performance of the country? e Government use leading economic indicators to predict the performance of the economy so that the policymakers are able to apply the relevant policy at the right time. ¥¥ e Leading indicators gives the consumers, businesses the glimpse of where the economy is heading helping them to plan in advance on how they will satisfy the needs and wants. VY e Leading indicators give the businesses and investors opinions surveyed about orders in manufacturing and commodity prices. VY e Economists use these indicators to determine what will economy look like in the future vv e Leading indicator change before economy changes, so they tell policymakers whether economy will improve or decrease before it actually changes. VY (Accept any other relevant correct answer) Copyright Reserved Please Turn Over (4) (1) (1) (2) (2) (4)

“"-"KSownloaded from Stenmaraphysisicaam 3.4 3.5 March 2026 Discuss the role of households in the circular flow. (8) Households directly and indirectly own factors of production. Vv ¥ They sell factors of production and earn income.” ¥ Households earn income as wages or salaries in return for their factors of production from firms. vv Households pay tax to the government. Vv Households buy goods and services from businesses. VY (Maximum 4 marks for mere listing of facts) (Accept any other relevant correct answer) How can prosperity phase positively affect the economy? (8) Business sentiments become positive encouraging entrepreneurs to borrow money and buy machines which increases economic growth. VY More people are employed as production increases to meet local demand. VY Households get more income to be used to satisfy needs and wants. VV Businesses make more profit as government and households demand more goods and services. Vv Prices and wages increase to higher levels which will fuel.upinflation. vv Government can collect more revenue and decrease government burden because consumers are employed and increasing « nsumption. v ¥ ‘ (Maximum 2 marks for mere listing of facts/examples) (Accept any other relevant correct answer) TOTAL SECTION B: [40] Copyright Reserved Please Turn Over

E " ‘ March 2026 “="""Sownloaded from Stammaraphysics.aam as SECTION C QUESTION 4 MACROECONOMICS 40 MARKS- 40 MINUTES e Discuss in detail the markets within the four-sector model. (26) How can injections contribute to the South African economy? (10) Introduction A market is defined as any contact or communication between buyers and sellers of goods and services VY (2) (Accept any correct relevant introduction) BODY: MAIN PART The Product/goods market ” ¢ Goods and services are traded in the product market. All participants purchase these goods and services in the product market. ¥¥ e Goods are defined as tangible items (suctias) food, setothing and cars) that satisfy some human wants and needsY e Services are non-tangible actions (such as medical care, cleaning services) that satisfy wants and need. vv e Non-durable goods are those items which are used ep when they are consumed and cannot be re-used, for example petrol, electricity. vv Semi-durable goods last a short period of time and can be used more than once. VY Durable goods can be used over again and do not wear out very easily e.g vehicles” ¥ e Households purchase consumer goods for consumption and businesses purchase capital goods for use in the production process. Vv” The Factor/Resource market ¥ e The four factors of production are traded for income in form of wages/salaries, interest, economic rent and profit in this market. Vv” e Businesses purchase the factors of production from the households in the factor market. vv e The price and quantity traded is also determined by interaction between supply and demand. vv e The factor market can be further subdivided into markets in which different factors of production like labour, property market. vv Copyright Reserved Please Turn Over

March 2026 “"-"Sownloaded from Stenmaraphysiasicaam The financial market “ The financial market serves those who wish to save and those who wish to borrow. v¥ The ‘money, capital and foreign exchange markets are part of the financial market Vv stor represents financial institutions which are not directly involved in the roduction of goods and services but are a link between participants in the economy with surplus money and participants who require funds. Vv“ e Households make their financial capital available to the financial sector in the form of savings. VY e The financial sector in turn makes financial capital available to firms through investments. ¥¥ Money market” This is used by participants as a means for borrowing and lending in short term, from a few days to just less than 3 years. VY SARB is the key institution in the money market. v ” Capital market Vv e This is a financial market where individuals and institutions trade financial securities in the long-term, which is 3 years and above..v¥ ~ e The JSE is the key institution in the capital markets ¥ v The foreign exchange marketY e Inan open economy, foreign currency is needed to to faclitat transaction between counties. vv It is on this market that one currency can be exchanged for another. vv The amount that is received in this exchange is known as exchange rate. Vv The exchange rates are normally determined by the interaction between supply and demand. ¥¥ e They are sometimes influenced by the Reserve BankY ¥ (Max of 8 marks for subheading and examples) (26) (Accept any relevant correct answer) ADDITIONAL PART How can injections contribute to the South African economy? (10) e Increase in investments may create new jobs for the household. v ¥ e Investment in new businesses will increase the government income because businesses pay corporate tax. VY e Increase in government spending on infrastructure help to attract more investment to rural areas too. VY e Increasing exports will improve local production of goods and services while allowing participants to get income. VV e Increase in household consumption will cause business profits to increase allowing them to expand production and employment. v ¥ e Improvement in grants allocation help to improve the standard of living of unemployed household. Vv“ (Maximum 2 marks for mere listing of facts) (Accept any other correct relevant answer) Copyright Reserved Please Turn Over

March 2026 “"-"Sownloaded from Stemmaraphysiasiaaam Conclusion: The circular flow will be in equilibrium when injections are equal to leakages and this will prevent all withdrawals that will disadvantage economic growth. VY (Max 2) (Accept any other correct relevant conclusion) [40] QUESTION 5 Discuss in detail the effects of the business cycles. (26) How can flooding as an exogenous factor negatively impact the economy? (10) INTRODUCTION Business cycles are defined as consecutive periods of increasing and decreasing of economic activity over a certain period. vv (Accept any other relevant correct introduction) (Max. 2) BODY: MAIN PART CHANGES IN AGGREGATE SUPPLY AND AGGREGATE DEMANDY + Aggregate supply (AS) is the total supply. of goods. and services in the economy that domestic firms are willing to sellat a certain price and time. vv + Aggregate demand (AD) is the total demand for goods and services in the economy produced by the domestic firms over a certain period. vv During the downswing of the business)cycle: . There is a decrease in total spending vv . Firms decrease their production levelsv ¥ During the upswing of the business cycle: + There is an increase in total spending. vv + Firms increase their output levels. vv CHANGES IN ECONOMIC GROWTH RATES Y¥ . Changes in economic growth rates have important effects on the economy. VW” During the downswing of the business cycle: . Output starts to decrease slowly then at a faster rate. vv Copyright Reserved Please Turn Over

“re"Sownloaded from Stenmaraphysigsicam Maren 2028 : As the bottom of the cycle approaches (trough), the drop in output slows. During the upswing of the business cycle: Output starts to increase slowly during the recovery.v ¥ . The 1 rate of increase, increases during the prosperity phase until the peak is r a nn rease in economic growth is important because: . It creates more employment opportunities. v v . Higher tax collection means that government can increase services and welfare levels. Vv . Consumers can buy more goods and services, and enjoy better standard of living. vv CHANGES IN EMPLOYMENT v During the downswing of the business cycle: . Consumers demand and therefore output decrease, leading to a lower demand for labour. ¥¥ . New employment decreases after the peak, and then a recession deepens people lose their jobs. Vv . Unemployment levels remain very high during the depression, vv During the upswing of the business cycle: : As output increases, employment also increases during the recovery; it is at highest levels during the prosperity phase. vv . Full employment is only reached by highly-skilled workers. Vv ¥ . Unemployment among unskilled and low-skilled workers in South Africa remain high. Vv CHANGES IN PRICE LEVELSY . As the prosperity phase progresses there is an increase in demand and a shortage of outputY ¥ . This allows producers to increase their prices leading to an increase in inflation. VW . As the recession sets in, prices rise less quickly: inflation rate drops. VW . In very deep recessions and depressions prices can drop to encourage demand. VY CHANGES IN EXCHANGE RATES ¥ . The exchange rate is the rate at which one currency is exchange for another. Vv . During the downswing of the business cycle imports and foreign investment decrease. VV : The demand for the currency decreases, and its price decreases. VV Copyright Reserved Please Turn Over

March 2026 “re"Sownloaded from Stenmaraphysigsacam EFFECTS ON THE ECONOMICALLY VULNERABLEY o During upswing imports and foreign investment increase. v * The demand for the currency increases so the price increase in terms other currencies. vive . are fewer opportunities for employment so the economically vulnerable often find themselves in a desperate position. vv The'state has less money to spend so social services and welfare grants are not likely to increase that much. vv During the upswing of the business cycle: There are more jobs on offer so the economically vulnerable are more likely to able to gain employment, although their position is always difficult. VW . The State is ina better position to provide social services and welfare grants. vv (Accept any other relevant correct answer) (Max 26) How can flooding as an exogenous factor negatively impact the economy? (10) e The natural disaster like flood can cause damage on infrastructure like road, bridges which will increase government spending to repair. Vv e Business operation may also be negatively affected leading to decrease of productivity and loss of profits. VY e Workers may not be able to reach their workstations inereasing absenteeism and may lose income. ¥¥ e Transport will be scarce because of damaged infrastructure and this will lead to shortage of goods in some parts of the country and prices will increase. VY e Agricultural products such as crops and livestock will be washed away and this will threaten food supply. ¥“ e Flooding can lead to job losses as agriculture and tourism sectors depend on good weather. vv (Accept any other correct relevant response) CONCLUSION It remains clear that business cycles must be closely monitored through the indicators available and policy makers must act to prevent economic instability. v” (Max 2) (Accept any other correct relevant conclusion) TOTAL MARKS: [100] Copyright Reserved