# Economics Grade 11 P2 November Mock Exam 2 2026 Memo (Eng) > Grade 11 Economics Paper 2 memorandum from the November Mock Exam 2 2026 (English), 18 pages. Read online or download the free PDF. - Page: https://www.hlayiso.com/library/grade-11-economics-2026-november-mock-exam-2-memorandum-paper-2/8c776339-77f7-4381-858c-97017532f523 - Updated: 2026-10-29 - Subject: Economics - Grade: Grade 11 - Language: English - Document type: Memorandum - Year: 2026 - Exam period: November Mock Exam 2 - Paper: 2 - Publisher: Hlayiso - Curriculum: CAPS - Pages: 18 Breadcrumbs: [Home](https://www.hlayiso.com/) › [Library](https://www.hlayiso.com/library) › [Grade 11](https://www.hlayiso.com/library/grade-11) › [Economics](https://www.hlayiso.com/library/grade-11/economics) › [Economics Grade 11 P2 November Mock Exam 2 2026 Memo (Eng)](https://www.hlayiso.com/library/grade-11-economics-2026-november-mock-exam-2-memorandum-paper-2/8c776339-77f7-4381-858c-97017532f523) ## About this document Economics · Grade 11 · November Mock Exam 2 · 2026 · English. Memorandum, 18 pages. Read online or download the PDF. Read it free online on the page above; download the PDF from there. ## Document text Text extracted from the PDF. Layout, diagrams and tables may not survive extraction. ### Page 1 Mock hlayiso mock exams Practice Series: Grade 11 Exam Preparation WWW.HLAYISO.COM NATIONAL SENIOR CERTIFICATE GRADE 11 ECONOMICS P2 NOVEMBER EXAMINATION 2026 (MOCK) MARKING GUIDELINES MARKS: 150 These marking guidelines consist of 18 pages. Copyright reserved Please turn over ### Page 2 Economics/P2 2 Hlayiso/Mock 2026 NSC – Marking Guidelines PRINCIPLES FOR MARKING ECONOMICS (HLAYISO MOCK 2026) • Mark ALL responses in the candidate’s script, whether correct or incorrect. • Where a candidate gives more responses than required: in Section A mark the FIRST response only; in 2.1.1, 3.1.1 and 4.1.1 mark the first TWO responses only; in Sections B and C (choice questions) mark only the required number of questions and write EXTRA on any additional question. • Use ONE tick (✓) for each mark awarded, placed at the fact being credited. Use a neat cross for incorrect responses. • One-word answers are acceptable for: list, name, state, identify. FULL sentences are required for: describe, explain, evaluate, analyse, suggest, differentiate, distinguish, define, discuss, why, how. The words provide, what, tabulate, identify and give are read in context. • Calculations: marks are allocated for the method/workings and for the correct final answer as shown in these guidelines. Where a candidate makes an error early in a calculation, mark the rest with consequential accuracy (CA). • Graphs are marked according to the allocation of marks given in these guidelines. • Accept responses that are correct and relevant but expressed differently. Spelling errors are not penalised if the meaning is clear. • In multiple-choice questions, accept the correct answer written in words instead of the letter. Copyright reserved Please turn over ### Page 3 Economics/P2 3 Hlayiso/Mock 2026 NSC – Marking Guidelines SECTION A (COMPULSORY) QUESTION 1 30 MARKS – 20 MINUTES 1.1 MULTIPLE-CHOICE QUESTIONS 1.1.1 C – price elastic ✓✓ 1.1.2 C – negative ✓✓ 1.1.3 B – normal ✓✓ 1.1.4 C – an oligopoly ✓✓ 1.1.5 A – derived ✓✓ 1.1.6 B – customs union ✓✓ 1.1.7 B – Basel Convention ✓✓ 1.1.8 A – Sustainable Development Goals ✓✓ (8 x 2) (16) 1.2 MATCHING ITEMS 1.2.1 D – the price of a product expressed in terms of the price of another product ✓ 1.2.2 I – total revenue divided by the number of units sold ✓ 1.2.3 F – certificates that give firms the right to emit a certain amount of pollution and that can be sold to other firms ✓ 1.2.4 H – an agreement between firms to fix prices or to share the market among themselves ✓ 1.2.5 A – the additional satisfaction gained from consuming one more unit of a product ✓ 1.2.6 B – selling products in a foreign market at a price lower than the price charged in the home market or below the cost of production ✓ 1.2.7 E – the process by which fertile land is turned into desert, e.g. by drought and overgrazing ✓ 1.2.8 C – the total amount of greenhouse gases caused by the activities of a person, business or country ✓ (8 x 1) (8) 1.3 GIVE THE TERM 1.3.1 Cross (price) elasticity of demand ✓ 1.3.2 Substitute goods/substitutes ✓ 1.3.3 Price discrimination ✓ 1.3.4 Total revenue ✓ 1.3.5 Renewable resources ✓ 1.3.6 Tariffs/customs duties/import duties ✓ (6 x 1) (6) [30] TOTAL SECTION A: 30 Copyright reserved Please turn over ### Page 4 Economics/P2 4 Hlayiso/Mock 2026 NSC – Marking Guidelines SECTION B QUESTION 2: MICROECONOMICS 40 MARKS – 30 MINUTES 2.1.1 Name any TWO examples of fixed costs. • Rent ✓ • Insurance premiums ✓ • Salaries of permanent staff ✓ • Interest on loans ✓ • Depreciation of machinery and buildings ✓ • Licence fees/property rates ✓ (Accept any other correct relevant response) (2 x 1) (2) 2.1.2 Why is the long run regarded as a planning period for a business? In the long run all factors of production are variable, so the business can plan to change its scale of production, e.g. build a new factory, buy new machines or enter or leave the industry ✓✓ (Accept any other correct relevant response) (1 x 2) (2) 2.2.1 Identify the profit-maximising output. 400 tons ✓ (1) 2.2.2 Name the type of profit shown by the shaded area. Economic profit/supernormal profit/abnormal profit ✓ (1) 2.2.3 Briefly describe the term marginal cost. The additional cost of producing one more unit of output ✓✓ (Accept any other correct relevant response) (2) 2.2.4 Explain why the AR curve is also the MR curve for this farmer. The farmer is a price taker and sells every additional ton at the same market price (R6 000), so the extra revenue from each unit (MR) equals the price/average revenue (AR) ✓✓ (Accept any other correct relevant response) (2) 2.2.5 Calculate the total profit at the profit-maximising output. Profit = (AR – AC) × Q ✓ = (60 – 48) × 400 ✓ = 12 × 400 ✓ = 4 800 (R’00), i.e. R480 000 ✓ OR TR = 60 × 400 = 24 000; TC = 48 × 400 = 19 200; Profit = 24 000 – 19 200 = 4 800 (R’00) = R480 000 (Accept 4 800 or R480 000 for the final mark) (4) Copyright reserved Please turn over ### Page 5 Economics/P2 5 Hlayiso/Mock 2026 NSC – Marking Guidelines 2.3.1 Identify ONE barrier to entry mentioned in the extract. • The municipality holds the only licence to supply water ✓ • Building a second network of pipes is extremely expensive (high start-up costs) ✓ (1) 2.3.2 Name the type of monopoly that the water utility represents. • Natural monopoly ✓ • Public/state-owned (government) monopoly ✓ • Legal/artificial monopoly (licence) ✓ (1) 2.3.3 Briefly describe the term monopoly. A market structure in which there is only one seller of a product that has no close substitutes, and entry into the market is blocked ✓✓ (Accept any other correct relevant response) (2) 2.3.4 Explain why households continued to use almost the same amount of water after the tariff increase. Water is a necessity with no close substitutes, so its demand is price inelastic: a price increase causes only a small decrease in the quantity demanded ✓✓ (Accept any other correct relevant response) (2) 2.3.5 How can the government protect consumers against high prices charged by monopolies? • By regulating prices/setting maximum tariffs through regulators, e.g. NERSA for electricity ✓✓ • By using competition laws and the Competition Commission to prevent the abuse of market power ✓✓ • By removing barriers to entry, e.g. issuing licences to new suppliers, to encourage competition ✓✓ • By subsidising the product or providing free basic services, e.g. free basic water for poor households ✓✓ • By nationalising or breaking up monopolies that abuse their power ✓✓ (Accept any other correct relevant response) (2 x 2) (4) Copyright reserved Please turn over ### Page 6 Economics/P2 6 Hlayiso/Mock 2026 NSC – Marking Guidelines 2.4 Briefly discuss interdependence and non-price competition as characteristics of an oligopoly. Interdependence ✓ • Because there are only a few large firms, the decisions of one firm directly affect the sales and profits of its rivals ✓✓ • Each firm must consider how its competitors will react before it changes its price or output ✓✓ • If one firm lowers its price, the others are likely to follow, which may lead to a price war ✓✓ • If one firm raises its price, rivals may not follow, so it loses market share; this explains the kinked demand curve and stable (rigid) prices ✓✓ • Interdependence may encourage firms to collude, e.g. by forming cartels, although this is illegal ✓✓ (Max. 4) Non-price competition ✓ • Firms avoid price wars and compete in other ways to win customers ✓✓ • They spend large amounts on advertising and branding to build customer loyalty ✓✓ • They offer extended services, e.g. after-sales service, guarantees, free delivery and loyalty programmes ✓✓ • They improve product quality and packaging or introduce new features (product differentiation) ✓✓ • Examples: cell phone networks and banks compete through data bundles, rewards and new apps ✓✓ (Max. 4) (Accept any other correct relevant response) (A maximum of 4 marks may be allocated for mere listing of facts/examples) (2 x 4) (8) Copyright reserved Please turn over ### Page 7 Economics/P2 7 Hlayiso/Mock 2026 NSC – Marking Guidelines 2.5 How can businesses use their knowledge of income elasticity of demand when planning production? • They can identify normal goods (positive YED), whose demand rises as incomes rise, and plan to increase production of these goods ✓✓ • They can reduce the production of inferior goods (negative YED) when incomes are rising, because demand for these goods will fall ✓✓ • During an economic boom they can expand the production of luxury goods (YED greater than one), whose demand grows faster than income ✓✓ • During a recession they can focus on necessities (YED between 0 and 1), whose sales fall only slightly when incomes fall ✓✓ • They can diversify their product range, e.g. sell both luxuries and necessities, to reduce the risk of falling sales over the business cycle ✓✓ • They can forecast future sales as household incomes grow and plan investment in machinery, workers and stock accordingly ✓✓ • They can plan inventory levels so that they do not hold too much or too little stock when incomes change ✓✓ (Accept any other correct relevant response) (A maximum of 2 marks may be allocated for mere listing of facts/examples) (4 x 2) (8) [40] Copyright reserved Please turn over ### Page 8 Economics/P2 8 Hlayiso/Mock 2026 NSC – Marking Guidelines QUESTION 3: CONTEMPORARY ECONOMIC ISSUES 40 MARKS – 30 MINUTES 3.1.1 Name any TWO causes of globalisation. • Improvements in communication technology/the internet ✓ • Improved and cheaper transport ✓ • Trade liberalisation (removal of trade barriers) ✓ • Growth of multinational corporations ✓ • Increase in foreign direct investment/capital flows ✓ • Standardisation of products and production methods ✓ • Influence of international organisations, e.g. the WTO ✓ (Accept any other correct relevant response) (2 x 1) (2) 3.1.2 Why do MNCs invest in developing countries? • To take advantage of cheap labour and raw materials, which lowers production costs ✓✓ • To gain access to new and growing markets for their products ✓✓ • To benefit from tax incentives and fewer regulations offered by host governments ✓✓ (Accept any other correct relevant response) (1 x 2) (2) 3.2.1 Identify the trade agreement that aims to reduce tariffs between African countries. African Continental Free Trade Area (AfCFTA) ✓ (1) 3.2.2 Name ONE regional trade agreement or customs union, other than the AfCFTA, of which SA is a member. • Southern African Customs Union (SACU) ✓ • SADC Free Trade Area ✓ • Tripartite Free Trade Area (COMESA–EAC–SADC) ✓ (1) 3.2.3 Briefly describe the term trade bloc. A group of countries in a region that agree to reduce or remove trade barriers, e.g. tariffs and quotas, among themselves to promote trade between members ✓✓ (Accept any other correct relevant response) (2) 3.2.4 Explain why some small local manufacturers fear the AfCFTA. Lower tariffs allow cheaper imports from other African countries into South Africa; small local firms may not be able to compete and may lose market share, close down and retrench workers ✓✓ (Accept any other correct relevant response) (2) Copyright reserved Please turn over ### Page 9 Economics/P2 9 Hlayiso/Mock 2026 NSC – Marking Guidelines 3.2.5 How can groupings such as BRICS and the G20 help to reduce the North–South divide? • They give developing countries a stronger voice in negotiating fairer global trade and financial rules ✓✓ • They provide development finance for infrastructure, e.g. through the BRICS New Development Bank ✓✓ • They promote trade and investment between member countries, which creates jobs and economic growth in the South ✓✓ • They encourage the transfer of technology and skills to developing countries ✓✓ • They can agree on debt relief and support for the poorest countries ✓✓ (Accept any other correct relevant response) (2 x 2) (4) 3.3.1 Identify the type of pollution shown in the cartoon. • Plastic pollution ✓ • Water/marine (ocean) pollution ✓ • Land pollution/litter ✓ (1) 3.3.2 Name ONE way in which households can reduce plastic waste. • Use reusable shopping bags ✓ • Recycle plastic products ✓ • Avoid single-use plastics, e.g. straws and bottled water ✓ • Reuse plastic containers ✓ • Buy products with less packaging ✓ (Accept any other correct relevant response) (1) 3.3.3 Briefly describe the term pollution. The contamination of the air, water or land by harmful substances or waste, which damages the environment and people’s health ✓✓ (Accept any other correct relevant response) (2) 3.3.4 Explain how charging customers for plastic bags can reduce pollution. The charge increases the price of plastic bags, so consumers buy fewer bags and bring their own reusable bags, which reduces the number of bags that end up as litter ✓✓ (Accept any other correct relevant response) (2) Copyright reserved Please turn over ### Page 10 Economics/P2 10 Hlayiso/Mock 2026 NSC – Marking Guidelines 3.3.5 How does marine pollution negatively affect the economy of a coastal town? • Fewer tourists visit polluted beaches, so income and jobs in hotels, restaurants and shops decrease ✓✓ • Fish stocks decline, which reduces the catch and income of fishermen and the fishing industry ✓✓ • The municipality must spend more money on cleaning beaches, leaving less for other services ✓✓ • Contaminated seafood can cause health problems, which reduces the productivity of workers ✓✓ • Property values and investment in the town may decrease ✓✓ (Accept any other correct relevant response) (2 x 2) (4) 3.4 Distinguish between foreign direct investment and portfolio investment. Foreign direct investment (FDI) ✓ • FDI is investment in physical assets, e.g. factories, mines, machinery and buildings, in another country ✓✓ • The investor (often an MNC) owns and controls the business in the host country ✓✓ • It is a long-term investment that is not easily withdrawn ✓✓ • It creates jobs directly and transfers technology and skills to the host country ✓✓ • Example: a foreign car manufacturer building an assembly plant in South Africa ✓✓ (Max. 4) Portfolio investment ✓ • Portfolio investment is the purchase of financial assets, e.g. shares and bonds, in another country ✓✓ • The investor does not control the business; the aim is to earn dividends, interest or capital gains ✓✓ • It is usually short term and can be withdrawn quickly (“hot money”), which can cause currency instability ✓✓ • It does not create jobs directly ✓✓ • Example: a foreign pension fund buying South African government bonds on the stock exchange ✓✓ (Max. 4) (Accept any other correct relevant response) (A maximum of 4 marks may be allocated for mere listing of facts/examples) (2 x 4) (8) Copyright reserved Please turn over ### Page 11 Economics/P2 11 Hlayiso/Mock 2026 NSC – Marking Guidelines 3.5 Analyse the importance of conserving biodiversity for the SA economy. • South Africa’s variety of wildlife and natural areas attracts tourists, which earns foreign exchange and creates jobs ✓✓ • Healthy ecosystems provide clean water, fertile soil and pollination of crops, which support agriculture ✓✓ • Plants and animals are a source of medicines and raw materials, e.g. rooibos and indigenous medicinal plants ✓✓ • Biodiversity supports fishing and forestry industries and the livelihoods of rural communities ✓✓ • Wetlands and forests protect against floods and erosion, which reduces the cost of disasters ✓✓ • Conserving biodiversity ensures that resources remain available for future generations (sustainable development) ✓✓ (Accept any other correct relevant response) (A maximum of 2 marks may be allocated for mere listing of facts/examples) (4 x 2) (8) [40] QUESTION 4: MICROECONOMICS AND CONTEMPORARY ECONOMIC ISSUES 40 MARKS – 30 MINUTES 4.1.1 Name TWO characteristics of monopolistic competition. • Many sellers/firms ✓ • Differentiated products ✓ • Relatively easy entry and exit ✓ • Some control over price ✓ • Non-price competition, e.g. advertising and branding ✓ • Downward-sloping demand curve ✓ (Accept any other correct relevant response) (2 x 1) (2) 4.1.2 Why is global warming a problem that cannot be solved by one country alone? Greenhouse gases emitted in one country spread through the atmosphere and affect the whole world, so all countries must cooperate to reduce emissions ✓✓ (Accept any other correct relevant response) (1 x 2) (2) 4.2.1 Identify the number of vetkoek at which TU is at its maximum for the first time. 5 (vetkoek) ✓ (1) 4.2.2 Name the law illustrated by the MU column. Law of diminishing marginal utility ✓ (1) Copyright reserved Please turn over ### Page 12 Economics/P2 12 Hlayiso/Mock 2026 NSC – Marking Guidelines 4.2.3 Briefly describe the term total utility. The total satisfaction that a consumer obtains from consuming a certain quantity of a product ✓✓ (Accept any other correct relevant response) (2) 4.2.4 Explain why a rational consumer will not buy the seventh vetkoek. The marginal utility of the seventh vetkoek is negative (−4), so it reduces total utility (from 60 to 56); a rational consumer will not pay for something that makes him/her worse off ✓✓ (Accept any other correct relevant response) (2) 4.2.5 Calculate the values of A and B. A: TU3 = TU2 + MU3 = 36 + 12 ✓= 48 utils ✓ B: MU5 = TU5 – TU4 = 60 – 56 ✓= 4 utils ✓ (2 x 2) (4) 4.3.1 Identify the country with the lowest CO2 emissions per person. Country N ✓ (1) 4.3.2 Name ONE greenhouse gas other than carbon dioxide. • Methane ✓ • Nitrous oxide ✓ • Chlorofluorocarbons (CFCs) ✓ • Water vapour ✓ • Ozone ✓ (1) 4.3.3 Briefly describe the term global warming. The gradual increase in the average temperature of the earth’s atmosphere, caused by the build-up of greenhouse gases that trap heat ✓✓ (Accept any other correct relevant response) (2) 4.3.4 Explain why industrialised countries emit much more CO2 per person. Industrialised countries have many factories, more cars and much higher energy use per person, and they burn large amounts of fossil fuels (coal, oil and gas) to produce electricity and goods ✓✓ (Accept any other correct relevant response) (2) Copyright reserved Please turn over ### Page 13 Economics/P2 13 Hlayiso/Mock 2026 NSC – Marking Guidelines 4.3.5 How can developing countries be assisted to grow without greatly increasing emissions? • Developed countries can provide climate finance, e.g. grants and cheap loans for green projects ✓✓ • Clean technologies (solar, wind) can be transferred to developing countries at low cost ✓✓ • International organisations can help to train workers in green skills ✓✓ • Carbon credits/trading schemes can reward developing countries for protecting forests ✓✓ • Rich countries can invest in renewable energy and public transport projects in developing countries ✓✓ (Accept any other correct relevant response) (2 x 2) (4) 4.4 Distinguish between accounting profit and economic profit. Accounting profit ✓ • Accounting profit is total revenue minus explicit costs ✓✓ • Explicit costs are the actual payments to outsiders, e.g. wages, rent and raw materials ✓✓ • It does not take opportunity (implicit) costs into account, e.g. the owner’s own time and capital ✓✓ • It is the profit shown in the financial statements and on which tax is calculated ✓✓ (Max. 4) Economic profit ✓ • Economic profit is total revenue minus total costs, i.e. explicit plus implicit costs (including normal profit) ✓✓ • Implicit costs are the opportunity costs of factors owned by the entrepreneur, e.g. forgone salary and interest ✓✓ • Economic profit is therefore smaller than (or at most equal to) accounting profit, because implicit costs are also subtracted ✓✓ • Economic profit attracts new firms into an industry, e.g. in a perfect market it disappears in the long run ✓✓ (Max. 4) Example: TR R500 000, explicit costs R300 000, implicit costs R120 000: accounting profit = R200 000; economic profit = R80 000 ✓✓ (Accept any other correct relevant response) (A maximum of 4 marks may be allocated for mere listing of facts/examples) (2 x 4) (8) Copyright reserved Please turn over ### Page 14 Economics/P2 14 Hlayiso/Mock 2026 NSC – Marking Guidelines 4.5 Evaluate the use of command-and-control measures to protect the environment. Positive • Standards and regulations are clear and easy to understand, e.g. maximum emission levels for factories ✓✓ • They are effective in banning very harmful activities completely, e.g. dumping toxic waste or using dangerous chemicals ✓✓ • Results are more certain because every polluter must comply with the same rules ✓✓ • Fines and penalties for offenders discourage pollution and raise revenue for the state ✓✓ Negative • They are expensive to monitor and enforce; inspectors are often too few to check all firms ✓✓ • They give firms no incentive to reduce pollution below the legal limit ✓✓ • The same rule for all firms is inefficient, because some firms can reduce pollution more cheaply than others ✓✓ • Weak enforcement, corruption or low fines mean that some firms ignore the regulations ✓✓ • Strict rules increase production costs, which may lead to higher prices and job losses ✓✓ (Accept any other correct relevant evaluation) (A maximum of 2 marks may be allocated for mere listing of facts/examples) (4 x 2) (8) [40] TOTAL SECTION B: 80 Copyright reserved Please turn over ### Page 15 Economics/P2 15 Hlayiso/Mock 2026 NSC – Marking Guidelines SECTION C QUESTION 5: MICROECONOMICS 40 MARKS – 40 MINUTES Discuss in detail the types (degrees) of price elasticity of demand, with the aid of graphs. (26 marks) How can the government use its knowledge of price elasticity of demand when it imposes excise duties on products such as cigarettes and alcohol? (10 marks) INTRODUCTION Price elasticity of demand is the degree to which the quantity demanded of a product responds to a change in its price. ✓✓ PED = % change in quantity demanded ÷ % change in price. (Accept any other correct relevant introduction) (Max. 2) BODY: MAIN PART Perfectly inelastic demand (PED = 0) ✓ • The quantity demanded does not change at all when the price changes ✓✓ • The demand curve is vertical (parallel to the price axis) ✓✓ • Example: life-saving medicines such as insulin (in the short run) ✓✓ Relatively (price) inelastic demand (0 < PED < 1) ✓ • The percentage change in quantity demanded is smaller than the percentage change in price ✓✓ • The demand curve is steep ✓✓ • Examples: necessities and habit-forming goods, e.g. bread, electricity, petrol, cigarettes ✓✓ Unitary elastic demand (PED = 1) ✓ • The percentage change in quantity demanded is equal to the percentage change in price ✓✓ • The demand curve is a rectangular hyperbola: total spending (revenue) stays the same at all prices ✓✓ Relatively (price) elastic demand (1 < PED < ∞) ✓ • The percentage change in quantity demanded is greater than the percentage change in price ✓✓ • The demand curve is relatively flat ✓✓ • Examples: luxury goods and goods with many substitutes, e.g. a specific brand of cooldrink, restaurant meals ✓✓ Perfectly elastic demand (PED = ∞) ✓ • Consumers buy any quantity at one particular price, but nothing at all at a higher price ✓✓ • The demand curve is horizontal (parallel to the quantity axis) ✓✓ • Example: the demand curve of an individual firm in a perfect market, e.g. one maize farmer ✓✓ Copyright reserved Please turn over ### Page 16 Economics/P2 16 Hlayiso/Mock 2026 NSC – Marking Guidelines Price Price Price Price Price D P2 P2 P2 P2 D P P1 P1 P1 D P1 D D 0 Q 0 Q2 Q1 0 Q2 Q1 0 Q2 Q1 0 Quantity Quantity Quantity Quantity Quantity Perfectly inelastic Relatively inelastic Unitary elastic Relatively elastic Perfectly elastic (Max. 2 marks per graph for correct shape and labels – max. 8 marks for graphs, marked within the 26 marks) (Accept any other correct relevant response) (A maximum of 8 marks may be allocated for headings/examples) (Max. 26) ADDITIONAL PART • The demand for cigarettes and alcohol is price inelastic (habit-forming, few substitutes), so an excise duty reduces consumption only slightly ✓✓ • Because consumption falls only slightly, the government collects a large and reliable amount of tax revenue ✓✓ • Producers can pass most of the tax on to consumers in higher prices, so consumers carry most of the tax burden ✓✓ • If the aim is to reduce harmful consumption, the government must raise the duty sharply or combine it with other measures, e.g. education campaigns and advertising bans ✓✓ • Very high duties may encourage illegal trade (smuggling), which reduces tax revenue; the government must take this into account ✓✓ • Demand is more elastic for young/poor consumers, so higher duties can discourage them from starting to smoke or drink ✓✓ • Excise duties on goods with elastic demand would reduce sales sharply and raise little revenue, so government targets products with inelastic demand ✓✓ (Accept any other correct relevant response) (A maximum of 2 marks may be allocated for mere listing of facts/examples) (Max. 10) CONCLUSION Knowing the type of price elasticity of demand helps producers to set prices and helps the government to foresee how consumers will react to taxes, so that it can raise revenue and discourage harmful consumption at the same time. ✓✓ (Accept any other correct relevant higher-order conclusion) (Max. 2) [40] Copyright reserved Please turn over ### Page 17 Economics/P2 17 Hlayiso/Mock 2026 NSC – Marking Guidelines QUESTION 6: CONTEMPORARY ECONOMIC ISSUES 40 MARKS – 40 MINUTES Discuss in detail the problems that threaten the environment. (26 marks) Evaluate the effectiveness of international agreements in protecting the environment. (10 marks) INTRODUCTION The environment consists of the natural surroundings in which people, plants and animals live, including the air, water, land and natural resources; human activities increasingly damage it and threaten sustainable development. ✓✓ (Accept any other correct relevant introduction) (Max. 2) BODY: MAIN PART Pollution ✓ • Air pollution: emissions from factories, coal-fired power stations and vehicles cause respiratory diseases and acid rain ✓✓ • Water pollution: sewage, chemicals and plastic waste in rivers and oceans kill fish and make water unsafe to drink ✓✓ • Land pollution: illegal dumping and overfull landfill sites contaminate soil and groundwater ✓✓ Global warming and climate change ✓ • The burning of fossil fuels releases greenhouse gases that trap heat and raise the earth’s average temperature ✓✓ • This leads to more droughts, floods, heatwaves and rising sea levels, which damage farming, property and infrastructure ✓✓ Deforestation ✓ • Forests are cleared for farming, timber, firewood and settlements ✓✓ • Fewer trees absorb carbon dioxide, and the habitats of plants and animals are destroyed ✓✓ Land degradation: soil erosion and desertification ✓ • Overgrazing, poor farming methods and the removal of vegetation expose the topsoil to wind and water ✓✓ • Fertile land loses its productivity or turns into desert, which threatens food security ✓✓ Loss of biodiversity ✓ • Habitat destruction, poaching, pollution and alien species cause plants and animals to become extinct ✓✓ • Ecosystem services, e.g. pollination and clean water, and future sources of food and medicine are lost ✓✓ Depletion and overexploitation of natural resources ✓ • Non-renewable resources such as coal, oil and minerals are being used up ✓✓ • Renewable resources are used faster than they can regenerate, e.g. overfishing and overuse of water ✓✓ Hazardous and toxic waste ✓ • Nuclear, chemical and electronic (e-)waste can poison people and the environment for many years ✓✓ • Some rich countries export hazardous waste to poorer countries with weak laws ✓✓ Copyright reserved Please turn over ### Page 18 Economics/P2 18 Hlayiso/Mock 2026 NSC – Marking Guidelines Population growth and urbanisation ✓ • A growing population increases the demand for land, water, energy and food, which puts pressure on resources ✓✓ • Rapid urbanisation leads to informal settlements without proper sanitation and waste removal ✓✓ (Accept any other correct relevant response) (A maximum of 8 marks may be allocated for headings/examples) (Max. 26) ADDITIONAL PART Effective • The Montreal Protocol is regarded as successful: the use of ozone-depleting CFCs has been phased out and the ozone layer is recovering ✓✓ • Agreements such as the Kyoto Protocol and the Paris Agreement have made climate change a global priority and set emission targets ✓✓ • The Basel Convention controls the movement of hazardous waste and protects poor countries from becoming dumping grounds ✓✓ • CITES has reduced illegal trade in endangered species, e.g. rhino horn and ivory ✓✓ • Summits such as the WSSD (Johannesburg 2002) encouraged countries to pass environmental laws and to fund clean water and sanitation projects ✓✓ Not effective • Many targets are voluntary and there are no strong penalties for countries that do not meet them ✓✓ • Some major polluters did not ratify agreements or withdrew from them ✓✓ • Developing countries lack the funds and technology to meet targets, and promised climate finance has often not been paid in full ✓✓ • Global emissions are still increasing, so the agreements have not stopped global warming ✓✓ • Countries put economic growth and jobs before environmental protection ✓✓ (Accept any other correct relevant evaluation) (A maximum of 2 marks may be allocated for mere listing of facts/examples) (Max. 10) CONCLUSION The environment faces serious and interlinked threats; unless governments, businesses and households cooperate locally and internationally, these problems will reduce future economic growth and living standards. ✓✓ (Accept any other correct relevant higher-order conclusion) (Max. 2) [40] TOTAL SECTION C: 40 GRAND TOTAL: 150 Copyright reserved ## Related documents - [Gr 11 Economics P2 (English) November 2022 Possible Answers](https://www.hlayiso.com/library/gr-11-economics-p2-english-november-2022-possible-answers/bc77a01e-539e-4841-a199-debe5934a00c) — Economics · Memo · 2022 · Eng - [ECONOMIC P2 GR11 MEMO NOV2020 English.docx](https://www.hlayiso.com/library/grade-11-economics-2020-national-exemplar-november-exam-memorandum-paper-2-english/070080f9-31fe-4f7c-a3d1-7dba42820312) — Economics · Memo · 2020 · Eng - [Gr11 Ecn P2 (English) November 2019 Marking Guidelines](https://www.hlayiso.com/library/gr11-ecn-p2-english-november-2019-marking-guidelines/e6f7a0a0-ec6a-419d-94d2-6af273e1ffee) — Economics · Memo · 2019 · Eng - [ECON P2 GR11 MEMO NOV2018 English](https://www.hlayiso.com/library/econ-p2-gr11-memo-nov2018-english/363cac40-970a-41e6-a04a-3defa0f2d7b6) — Economics · Memo · 2018 · Eng - [ECON P2 GR11 MEMO NOV2017 English](https://www.hlayiso.com/library/econ-p2-gr11-memo-nov2017-english/51e501ea-19e2-4b65-81e6-14e4c0652cac) — Economics · Memo · 2017 · Eng - [ECONOMICS P2 GR11 MEMO NOV2016 English](https://www.hlayiso.com/library/economics-p2-gr11-memo-nov2016-english/023001bd-2c00-4d99-b37e-3347275fcb09) — Economics · Memo · 2016 · Eng ## More from Grade 11 Economics - [LP CS Economics Grade 11 March 2025 QP and Memo](https://www.hlayiso.com/library/lp-cs-economics-grade-11-march-2025-qp-and-memo/5d9f6601-bdd5-43eb-9f96-7f2865b253de) — QP + Memo · 2025 - [Gr 11 Economics P2 (English) June 2024 Question Paper](https://www.hlayiso.com/library/gr-11-economics-p2-english-june-2024-question-paper/a5bf3155-bcd3-4b96-83c6-1d36905153a9) — QP · 2024 · Eng - [ECONOMICS P1 GR11 QP NOV 2023 English D](https://www.hlayiso.com/library/economics-p1-gr11-qp-nov-2023-english-d/4a97e744-8e1f-49da-8a52-687fbba97845) — QP · 2023 · Eng - [ECONOMICS P1 GR11 QP NOV 2023 English](https://www.hlayiso.com/library/economics-p1-gr11-qp-nov-2023-english/7f6ceeb5-367e-4ca9-babe-ba5b26341549) — QP · 2023 · Eng - [ECONOMICS P2 QP GR11 NOV2023 English](https://www.hlayiso.com/library/economics-p2-qp-gr11-nov2023-english/4d677eb8-2e94-4c13-96c0-a9e115c3d907) — QP · 2023 · Eng - [Gr 11 Eco P2 (English) June 2023 Question Paper](https://www.hlayiso.com/library/gr-11-eco-p2-english-june-2023-question-paper/3148e25e-81ec-43d7-b75c-08a95adf3209) — QP · 2023 · Eng ## Collection - [Grade 11 past papers](https://www.hlayiso.com/grade-11/past-papers) --- Hlayiso: free CAPS and IEB past papers, memos, notes and study guides for South African learners. 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