Economics Grade 12 Paper 1 Gauteng Mock 2017 Question Paper

Downloaded from hlayiso.com GAUTENG DEPARTMENT OF EDUCATION PREPARATORY EXAMINATION 2017 10731 ECONOMICS FIRST PAPER TIME: 2 hours MARKS: 150 13 pages 1 P.T.O.

Downloaded from hlayiso.com ECONOMICS 2 (First Paper) 10731 / 17 GAUTENG DEPARTMENT OF EDUCATION PREPARATORY EXAMINATION – 2017 ECONOMICS (First Paper) TIME: 2 hours MARKS: 150 INSTRUCTIONS AND INFORMATION 1. Answer FOUR questions as follows in the ANSWER BOOK: • SECTION A: COMPULSORY • SECTION B: Answer any TWO of the THREE questions. • SECTION C: Answer any ONE of the TWO questions. 2. Answer only the required number of questions. Answers in excess of the required number of questions will NOT be marked. 3. Number the answers correctly according to the numbering system used in this question paper. 4. Write the number of the question above each answer. 5. Read the questions carefully. 6. Start EACH question on a NEW page. 7. Leave 2 – 3 lines between sub-sections of questions. 8. Answer the questions in full sentences and ensure that the format, content and context of your responses comply with the requirements of the questions. 9. Use only blue or black ink. 10. You may use a non-programmable pocket calculator. 11. Write neatly and legibly. P.T.O.

Downloaded from hlayiso.com ECONOMICS 3 (First Paper) 10731 / 17 SECTION A (COMPULSORY) QUESTION 1 30 MARKS – 20 MINUTES 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 – 1.1.8) in the ANSWER BOOK. 1.1.1 Earnings received from the export of goods and services are called … A leakages. B injections. C taxes. D savings. 1.1.2 The money market is a market for … term savings and loans. A medium B small C long D short 1.1.3 The Laffer curve illustrates the relationship between … and the tax rate. A demand B poverty C tax revenue D unemployment 1.1.4 Fluctuating factors that originate outside the economic system are referred to as ... factors. A indigenous B exogenous C endogenous D international 1.1.5 Headline inflation is measured by the unadjusted … A Producer Price Index figures. B repurchase rate. C Consumer Price Index figures. D exchange rate. P.T.O.

Downloaded from hlayiso.com ECONOMICS 4 (First Paper) 10731 / 17 1.1.6 Lowering the repo rate can be seen as a … approach to economic growth. A demand-side B banking C fiscal D value-added 1.1.7 Social indicators are also known as … indicators. A human development B economic C unemployment D interest rate 1.1.8 Taxation can be used as a mechanism to redistribute … A grants. B wages. C pensions. D wealth. (8 x 2) (16) P.T.O.

Downloaded from hlayiso.com ECONOMICS 5 (First Paper) 10731 / 17 1.2 Choose a description from COLUMN B that matches an item in 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 Appreciation A The number of children per 1000 live births who die before their first birthday 1.2.2 Free trade B A cash instrument 1.2.3 Taxation C An increase in the price of a currency in 1.2.4 Economic growth terms of another currency 1.2.5 Devaluation D Deliberate government intervention to reduce the value of a country’s currency 1.2.6 Integrated Manufacturing E The interest that the Reserve Bank Strategy charges other banks for borrowing money 1.2.7 Infant mortality F It strengthens institutional capacity and facilitates development 1.2.8 Repurchase rate G Absence of government barriers and restrictions to buy and sell goods globally H A fiscal policy instrument I An increase in the real GDP (8 x 1) (8) 1.3 Give ONE term for each of the following descriptions. Write only the term next to the question number (1.3.1 – 1.3.6) in the ANSWER BOOK. 1.3.1 A graph that shows the relationship between unemployment and inflation 1.3.2 The worldwide interaction of economies 1.3.3 The application of a trade policy whereby the state discourages the importing of goods that are also locally produced 1.3.4 The increases in people’s standards of living 1.3.5 The ratio between real inputs and real outputs in the economy 1.3.6 Spatial areas that offer particular advantages to mining and other businesses along a particular trade route (6 x 1) (6) TOTAL SECTION A: 30 P.T.O.

Downloaded from hlayiso.com ECONOMICS 6 (First Paper) 10731 / 17 SECTION B Answer TWO of the three questions from this section in the ANSWER BOOK. QUESTION 2: MACRO-ECONOMICS 40 MARKS – 30 MINUTES 2.1 Answer the following questions. 2.1.1 Name TWO types of markets in the circular flow. (2 x 1) (2) 2.1.2 How will savings be affected by an increase in the marginal propensity to consume? (1 x 2) (2) 2.2 Study the graph below and answer the questions that follow. SOUTH AFRICA: REAL GROSS DOMESTIC PRODUCT [Source: Adapted from www.sarb.co.za] 2.2.1 What was the real GDP growth in 2009? (1) 2.2.2 Identify the period (years) when the longest business cycle can be observed in the above graph. (1) 2.2.3 Briefly describe the term Gross Domestic Product. (2) 2.2.4 Explain the underlying forces of the amplitude in 2009. (2) 2.2.5 How can taxation be used to reverse the downward trend in the economy? (2 x 2) (4) P.T.O.

Downloaded from hlayiso.com ECONOMICS 7 (First Paper) 10731 / 17 2.3 Read the following extract carefully and answer the questions that follow. POOR MUNICIPAL AUDIT SIGNALS THE INABILITY TO COMPLY According to the Public Service Accountability Monitor (PSAM) hard questions needed to be asked about why municipalities are still not following the correct governance procedures. While the Auditor-General of South Africa (AGSA) has adopted sound auditing systems, more needs to be done to hold municipalities to account for the maladministration of public funds. Over a 10-year period the same thing has been repeated and the same audit finding is being made in terms of insufficient documentation. The system is repeating itself and gives the impression that the recurring problem of unauthorised and irregular expenditure is acceptable. An AGSA report highlights the appointment processes and difficulties in attracting and retaining skilled staff. It states that one of the biggest challenges for local government over the years has been to attract and retain qualified and competent persons in all areas of administration. These are factors that can contribute to public sector failure. [Source: Adapted from Eye-witness News, November 2016] 2.3.1 What are the TWO biggest challenges for local government, according to the extract? (2 x 1) (2) 2.3.2 Briefly describe the term public sector failure. (2) 2.3.3 What is the effect of unauthorized and irregular expenditure on service delivery? (2) 2.3.4 How will you address the inefficiency of municipalities in South Africa? (2 x 2) (4) 2.4 Differentiate between the Medium Term Expenditure Framework (MTEF) and the Medium Term Budget Policy Statement (MTBPS). (2 x 4) (8) 2.5 How are leading indicators used in the forecasting of economic activities? (8) [40] P.T.O.

Downloaded from hlayiso.com ECONOMICS 8 (First Paper) 10731 / 17 QUESTION 3: ECONOMIC PURSUITS 40 MARKS – 30 MINUTES 3.1 Answer the following questions. 3.1.1 Name TWO South African growth and development policies. (2 x 1) (2) 3.1.2 How will the selling of securities or bonds by the Reserve Bank affect the availability of credit? (1 x 2) (2) 3.2 Study the bar chart below and answer the questions that follow. 137.45 135.15 133.07 [Source: www.data.worldbank.org] 3.2.1 Describe the general trend of the terms of trade between 2011 and 2015. (1) 3.2.2 Identify the basis year in the above graph. (1) 3.2.3 Briefly describe the term terms of trade. (2) 3.2.4 What does an improvement in the terms of trade mean? (2) 3.2.5 How does a deterioration in the terms of trade impact on the balance of payments? (2 x 2) (4) P.T.O.

Downloaded from hlayiso.com ECONOMICS 9 (First Paper) 10731 / 17 3.3 Read the extract below and answer the questions that follow. SUPPLY REPLACES DEMAND AS MAJOR MINING ISSUE Insufficient supply is likely to be the dominant issue facing the mining industry in the next few years. Leading economists said that major issues include decreasing levels of supply as well as rising input costs, nationalisation, continued production stoppages and increasing remoteness of mineral resources. The mining industry is also facing a significant decline in market capitalization. It is believed that the lack of confidence in the industry might be due to global events such as those in the Euro zone, nuclear fallout in Japan, uncertainty about economic growth in China and the economic downgrading of some countries. [Source: Sunday Times, Business Times, 17 June 2016] 3.3.1 Identify ONE reason from the above extract why mines are experiencing an insufficient supply of resources. (1) 3.3.2 Name ONE global event that had an impact on the performance of the mining industry. (1) 3.3.3 Briefly describe the term nationalisation. (2) 3.3.4 What is the impact of continued production stoppages on the South African economy? (2) 3.3.5 How do high energy costs affect the struggling mining sector? (2 x 2) (4) 3.4 Briefly discuss poverty and trade as challenges of globalisation. (2 x 4) (8) 3.5 Evaluate the importance of life expectancy as social indicator. (8) [40] P.T.O.

Downloaded from hlayiso.com ECONOMICS 10 (First Paper) 10731 / 17 QUESTION 4: MACRO-ECONOMICS & ECONOMIC PURSUITS 40 MARKS – 30 MINUTES 4.1 Answer the following questions. 4.1.1 Name TWO types of exchange rate systems. (2 x 1) (2) 4.1.2 What will be the effect on inflation if the increase in labour productivity is lower than the increase in wages? (1 x 2) (2) 4.2 Study the table below and answer the questions that follow. Balance of Payments (R millions) 2015 Current account Merchandise exports………. …………...… 973 776 Net gold exports……………………………. 67 662 Services receipts …………………….……. 191 656 Income receipts…………………….…….… 98 016 Less: Merchandise imports……………….. 1 075 850 Less: Payment for services........................ 197 643 Less: Income payments ………………….. 198 382 Current transfers …………………….…..... -33 533 Balance on current account....................... -174 298 Memo item: Trade balance …………….… (A) [Source: Quarterly Bulletin SARB, December 2016] 4.2.1 Who is responsible for the publication of the above information? (1) 4.2.2 How many sub-accounts are there in the balance of payments? (1) 4.2.3 Briefly describe the term balance of payments. (2) 4.2.4 Briefly analyse the balance on the current account as indicated in the table above. (2) 4.2.5 Calculate the trade balance (A) for 2015. Show ALL calculations (4) P.T.O.

Downloaded from hlayiso.com ECONOMICS 11 (First Paper) 10731 / 17 4.3 Study the cartoon below and answer the questions that follow. … REMEMBER, WE CAN STILL TRY THE NATIONAL DEVELOPMENT PLAN! [Source: Adapted from internet images] 4.3.1 Identify TWO possible solutions that can prevent the South African economy from sinking completely. (2) 4.3.2 What is the National Development Plan? (2) 4.3.3 What are the main aims of the National Development Plan? (2) 4.3.4 How can the private sector assist in the development policies of the government? (4) 4.4 Discuss the multiplier effect on the national income. (4 x 2) (8) 4.5 How can investment spending be utilised efficiently to stimulate economic development? (8) [40] TOTAL SECTION B: 80 P.T.O.

Downloaded from hlayiso.com ECONOMICS 12 (First Paper) 10731 / 17 SECTION C Answer ONE of the two questions from this section in the ANSWER BOOK. MARK STRUCTURE OF ESSAY ALLOCATION Introduction The introduction is a lower-order response. • A good starting point would be to determine the main concept related to Max. 2 the question topic. • Do not include any part of the question in your introduction. • Do not repeat any part of the introduction in the body. • Avoid saying in the introduction what you are going to discuss in the body. Body Main part: Discuss in detail / In-depth discussion / Examine / Critically Max. 26 discuss / Analyse / Compare / Evaluate / Distinguish / Differentiate / Explain Additional part: Give own opinion / Critically discuss / Evaluate / Critically evaluate / Draw a graph and explain / Use the graph given and explain / Complete the given graph / Calculate / Deduce / Compare / Explain / Max. 10 Distinguish / Interpret / Briefly debate / How? / Suggest Conclusion Any relevant higher-order conclusion that should include: • A brief summary of what has been discussed / analysed without repeating facts already mentioned in the body • An opinion or value-judgement on the facts discussed Max. 2 • Additional support information to strengthen the discussion / analysis • A contradictory viewpoint with motivation, if required • Recommendations TOTAL 40 QUESTION 5: MACRO-ECONOMICS 40 MARKS – 40 MINUTES “Economic growth depends on trade, of which one of the strategies is the outward- looking policy of exports and international competitiveness.” • Discuss import substitution as part of South Africa's international trade policy. (26 marks) • Advise the Minister of Trade and Industry whether the South African government should adopt a policy of free trade or not. (10 marks) [40] P.T.O.

Downloaded from hlayiso.com ECONOMICS 13 (First Paper) 10731 / 17 QUESTION 6: ECONOMIC PURSUITS 40 MARKS – 40 MINUTES “A range of programmes give effect to the government’s commitment to support regional economic development.” • Discuss regional development in South Africa in terms of the best practice benchmarks. (26 marks) • Why were Industrial Development Zones (IDZs) not very successful since their inception in South Africa? (10 marks) [40] TOTAL SECTION C: 40 TOTAL: 150 END