ECONOMICS

Marking guide: 9.6 Cycle Test 1 term 1

GRADE 10

QUESTION 1

Question 1.1 [12 marks]

1.1.1 C ✓✓ leakage
1.1.2 C ✓✓ monetary economics
1.1.3 A ✓✓ prices increase and inflation occurs
1.1.4 B ✓✓ injection
1.1.5 C ✓✓ scarcity
1.1.6 C ✓✓ monetary

GUIDANCE TO THE MARKER

● There is only one correct answer for the multiple choice questions.
● If a learner has given more than one option e.g. 1.1.1 C / D - mark incorrect
even if one of the options is correct.
● If the learner writes out the answer instead of giving the letter - mark
correct.
● If the learner gives the correct letter and writes out the answer e.g. 1.1.1 C
leakage : mark as correct.
● There are two marks for each correct answer for this question.

Question 1.2 [4 marks]

1.2.1 E✓ Occurs when we make use of our resources to produce goods and
services
1.2.2 C✓ The difference between income and spending
1.2.3 A✓ The upper turning point of a business cycle
1.2.4 B✓ Businesses supply goods and services on the goods market to
households, the government and the foreign sector

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GUIDANCE TO THE MARKER

● There is only one correct answer for the matching column questions.
● If a learner has given more than one option e.g. 1.2.1 E / D - mark incorrect
even if one of the options is correct.
● If the learner writes out the answer instead of giving the letter - mark
correct.
● If the learner gives the correct letter and writes out the answer e.g. 1.2.1 E :
Occurs when we make use of our resources to produce goods and
● services : mark as correct.
● There is one mark for each correct answer for this question.

Question 1.3 [4 marks]

1.3.1 normative statement ✓

1.3.2 government / state ✓
1.3.3 per capita Gross Domestic Product / Gross Domestic Product per capita ✓
1.3.4 trough ✓

GUIDANCE TO THE MARKER

● There is only one correct answer for the terminology questions.

● If a learner has given more than one option e.g. 1.3.1 normative / subjective :
mark incorrect even if one option is correct.
● If the learner does not give the whole term e.g. 1.3.3 per capita instead of
per capita gross domestic product - mark incorrect.
● If the learner gives an abbreviation e.g. “eco. growth” instead of “economic
growth” : mark incorrect.
● If the learner gives an acronym e.g. “SARB” instead of “South African Reserve
Bank” : mark incorrect.
● If the learner gives an example e.g. “Vehicle” instead of “durable good” :
mark incorrect.
● There is one mark for each correct answer for this question.
● 1.3.1 Both words must be given.
● 1.3.2 Both terms given may be marked correct.
● 1.3.3 The whole term must be given to get the mark.
● If both words are not given, do not award any marks.
● If the spelling is not correct but the meaning of the word is not
changed by the incorrect spelling, the mark may be awarded

2
 ● We do not award half marks in Economics.

Total Section A: 20

QUESTION 2

Question 2.1

2.1.1 Name any TWO fields of study that are related to Economics. (2x1)(2)
• Accounting✓
• Business studies✓
• Commercial law✓
• Mathematics of finance ✓
• Mathematics ✓

GUIDANCE TO THE MARKER

● Learners must give TWO fields of study for 1 mark each.

● These are the only options which may be marked correct for this question.
● As the question verb is NAME the answers do not have to be in full
sentences.
● We do not award half marks in Economics.

2.1.2 Why do economists use mathematics? (1x2)(2)

To do calculations required to determine statistics about the economy, such as
population growth rates, GDP ✓✓
To derive and extend models such as the business cycle ✓✓
The construct models of supply and demand using calculations and graphs ✓✓
To test their theories✓✓
(Any other correct relevant answer)

GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which
are not stated in the marking guidelines if they answer the question.
● 2 marks are given for 1 fully explained point / fact.

3
 ● If a partial answer is given / answer is not in a full sentence, award 1 mark.
● We do not award half marks in Economics

Question 2.2

2.2.1 Name ONE example of an injection from the table above. (1)
Investments✓
Government expenditure✓
Total exports✓

GUIDANCE TO THE MARKER

● These are the only correct answers for this question.

● The answer does not have to be in a full sentence.
● We do not award half marks in Economics.

2.2.2 Name ONE example of a leakage from the table above. (1)
Savings✓
Tax revenue✓
Total imports ✓

GUIDANCE TO THE MARKER

● These are the only correct answers for this question.

● The answer does not have to be in a full sentence.
● We do not award half marks in Economics.

2.2.3 Briefly describe the concept individual consumption expenditure by

government. (2)
This is when the government spends money on goods and services produced for
individuals ✓✓
When one or a few consumers use this good or service, it excludes other
consumers from using it at the same time ✓✓
Examples include healthcare services, education, and social security ✓
(Any other correct relevant answer)

4
GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which
are not stated in the marking guidelines if they answer the question.
● 2 marks are given for a full definition written in a full sentence.
● If a partial definition is given / answer is not in a full sentence, award 1 mark.
● We do not award half marks in Economics.
● Key elements to look out for in this answer are :
this is a component of government expenditure
this includes public goods which are excludable and can only be used by one
person at a time

2.2.4 What would the impact on the economy be if leakages are greater than
injections? (2)
Leakages make the economy smaller if they are not matched by equal injections
✓✓
Leakages result in less domestic or local spending on products and services and
will lead to a decline in GDP if they are greater than injections to offset them ✓✓
There is a decrease in spending and consumption, which will result in a
decreased need for production, which will lead to a decline in economic activity if
leakages are greater than injections ✓✓
Leakages > injections means that economic growth will decrease ✓✓
If leakages are higher than injections economic growth will decrease ✓✓
(Any other correct relevant answer)

GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which
are not stated in the marking guidelines if they answer the question.
● 2 marks are given for a full explanation written in a full sentence.
● If a partial explanation is given / answer is not in a full sentence, award 1
mark.
● Key elements to look out for in this answer are :
any statement which indicates that when leakages are greater than
injections there is a decrease in production, consumption and expenditure
leading to a drop in economic growth / GDP
● We do not award half marks in Economics.

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2.2.5 Calculate Wingdale’s total leakages for 2016 using the information given in
the table above. Show ALL calculations. (4x1)(4)

Leakages = Savings + Tax revenue + Total Imports

= 100 ✓+ 210✓ + 190✓
= 500 ✓

GUIDANCE TO THE MARKER

● Give marks according to the ticks in the marking guideline.

● If learners give the correct answer only and do not show any working, a
maximum of 1 mark may be awarded.
● We do not award half marks in Economics.

Question 2.3

2.3.1 Which type of consumer goods do sweets belong to? (1)

Non-durable consumer goods✓
Perishable consumer goods ✓

GUIDANCE TO THE MARKER

● These are the only correct answers for this question.

● The answer does not have to be in a full sentence.
● We do not award half marks in Economics.

2.3.2 Name any basic need of households. (1)

Clothing ✓
Shelter ✓
Food ✓
Water ✓
(Accept any other correct relevant answer)

GUIDANCE TO THE MARKER

● These are the only correct answers for this question.

● The answer does not have to be in a full sentence.
● We do not award half marks in Economics.

6
2.3.3 Briefly describe the term relative scarcity. (2)
When a good or service is available, but one does not have the resources to
acquire it ✓✓
People live in relative scarcity when they are too poor to buy the goods that are
available. ✓✓
Unfortunately, some people cannot afford to satisfy their personal wants and
needs; the prices are just too high relative to their income. ✓✓
So for those people, food and housing, for example, will be relatively scarce. ✓✓
Relative scarcity exists where the demand for a good is greater than the supply
of a good ✓✓
We refer to relative scarcity as an upside down pyramid, the more people’s wants
and needs are satisfied, the more they want. We experience relative scarcity
when the demand for a product overtakes the supply available of that product
✓✓
(Accept any other correct relevant answer)

GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which
are not stated in the marking guidelines if they answer the question.
● The answer must be in a full sentence to obtain 2 marks.
● For partial answers / answers not in a full sentence, award 1 mark only.
● Award a maximum of 1 mark for an example illustrating the concept of
relative scarcity.

● The key ideas to look out for here are :

demand is greater than supply
shortage of supply
goods are scarce relative to the incomes earned by people because they
cannot afford them

● We do not award half marks in Economics.

2.3.4 How does having limited resources and unlimited wants affect the actions
of consumers? (2)
Consumers have to make choices about how to use their limited resources ✓✓
When faced with a scarcity of resources compared to wants / desires consumers
must make choices that will maximise their utility (satisfaction) ✓✓

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 Consumers have to sacrifice certain wants in order to make the best use of their
limited resources ✓✓
The opportunity cost of a choice is the item that was sacrificed / given up due to
limited resources ✓✓
Scarcity means that consumers want more than is available, therefore scarcity
requires choice✓✓
Consumers must choose which of their desires they will satisfy and which
they will leave unsatisfied✓✓
Scarcity forces consumers to make a choice (take less of something else) ✓✓
(Accept any other correct relevant answer)

GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which
are not stated in the marking guidelines if they answer the question.
● 2 marks are given for a fully explained answer, written in a full sentence.
● 1 mark may be awarded for a partial answer which is not in a full sentence.
● We do not award half marks in Economics.

2.3.5 Do all countries have sufficient resources to meet their needs? Briefly
explain your answer. (2x2)(4)
Countries do not have all the resources they need to satisfy their wants ✓✓
This applies to natural resources as well as capital, technology and labour ✓✓
For example, South Africa does not have its own oil resources and has a shortage
of skilled labour ✓✓
This means that countries enter into trade with other countries in order to
purchase the goods and services they have a shortage of ✓✓
Countries sell (export) their surplus resources to other countries which have a
shortage of that resource, which they buy (import) ✓✓
Countries import the goods and services which they do not have enough of to
meet the needs of their citizens ✓✓
Globalisation and advances in transport and technology have increased
international trade and made it easier for countries to trade with each other ✓✓
Example, South Africa imports oil from countries which have a surplus of that
product and exports citrus fruit to countries which cannot grow that product ✓
(Accept any other correct relevant answer)

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GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which
are not stated in the marking guidelines if they answer the question.
● 1 mark for an example which is not explained.
● 2 marks may be awarded for a fully explained example.
● A maximum of 2 marks may be awarded for examples : either (2x1) if the
examples are stated or (1x2) for a fully explained example.
● 2 full sentences each explaining one fact for 2 marks each must be given to
get maximum marks (2x2)(4).
● If four points are stated (not in full sentences), award a maximum of 2
marks.
● There may be a wide variety of answers here - read carefully and give credit
for answers which are correct but do not appear in the marking guideline.
● Key ideas to look out for here are :
countries do not have all the resources they need to satisfy the wants and
needs of citizens
this leads countries to trade
countries export the goods and services they have a surplus of and import
the goods and services they have a shortage of
● We do not award half marks in Economics.

2.4 Discuss the four factors of production in detail. (4x2)(8)

Land (natural resources)✓

These are all the resources occurring in nature and are sometimes
called the gift of nature. ✓✓
Examples include land and water ✓

Labour✓
Refers to all the mental and physical effort which is used in the
production process.✓✓
It is all the activities which humans perform in order to make money
and collect income in the form of wages and salaries.✓✓
The three skills categories of labour are skilled, semi-skilled and
unskilled ✓✓

Capital✓

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 Refers to the financial and capital goods that are used to produce other
goods and services.✓✓
Capital goods consist of man-made resources like buildings, machinery
and vehicles.✓✓
Financial capital consists of money used to buy capital goods.✓✓
This refers to all the machines and resources used in the production
process ✓✓
Not all resources are suitable for human consumption, so we often
need tools and equipment to develop these resources in such a way
that it can be consumed by humans, this equipment can be called
capital ✓✓

Entrepreneurship✓
Refers to the talent to begin a sustainable business by combining the
other factors of production ✓✓
This is a person who take risks and whose skills are needed to
combine all the factors of production to use it efficiently ✓✓
Entrepreneurs sees a gap in the market and takes a risk to open a
business in order for production to take place ✓✓
(Accept any correct relevant response)

GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which
are not stated in the marking guidelines if they answer the question.
● 1 fact stated in a full sentence for 2 marks each for each of the four factors
of production must be given to award full marks.
● A maximum of 2 marks for each factor of production may be awarded.
● Award 1 mark for naming each of the factors of production.
● If a partial explanation is given / answer is not in a full sentence, award 1
mark.
● 1 mark for an example of each factor of production may be awarded.
● Award a maximum of 4 marks for examples (1 for each factor of production
only).
● Award a maximum of 4 marks for facts merely stated and not explained (1
fact for each factor of production).
● We do not award half marks in Economics.

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2.5 Why is the use of models necessary in economics? (4x2)(8)
Models are used for:
• Understanding how the economy works✓✓
• Making forecasts✓✓
• Making it easier to understand the relationship between
variables✓✓
• Presented by means of quantitative expressions, illustrations,
diagrams and statements in writing or orally✓✓
• Studying and examining of economic issues✓✓

Economic activities can be very complex. Therefore, models are used to

construct these activities in a more simplified manner ✓✓
There are a number of different models used in economics, such as
diagrams, graphs, tables, etc. ✓✓

Economists use models to:

Describe economic activities, and how markets function in reality. ✓✓
Analyse past happenings and help to predict future outcomes. ✓✓
Take complex economic issues and present them in a simple manner for
everyone to understand. ✓✓
Explain certain economic processes, for example, the circular flow
diagram shows how money and goods and services move between
households, the public sector, and businesses. ✓✓
(Any other correct relevant answer)

GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which
are not stated in the marking guidelines if they answer the question.
● 2 marks for each fully explained point written in a full sentence.
● If a partial explanation is given / answer is not in a full sentence, award 1
mark.
● 1 mark for an example which is simply stated.
● 2 marks for a fully explained example.
● Award a maximum of 2 marks for examples of models.
● Award a maximum of 4 marks for answers which are stated / listed and not
written in full sentences.
● We do not award half marks in Economics.

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QUESTION 3

Question 3.1

3.1.1 List the TWO types of fluctuations that can occur within business
cycles. (2x1)(2)
Random fluctuations ✓
Seasonal fluctuations ✓

GUIDANCE TO THE MARKER

● These are the only correct answers.

● If the word FLUCTUATIONS is missing but the rest of the answer is correct,
award the full 1 mark.
● As the question verb is LIST, the answer does not have to be in a full
sentence.
● We do not award half marks in Economics.

3.1.2 How can consumption cause environmental pollution? (1x2)(2)

Consumption causes environmental damage, such as the air pollution caused
by driving a car.✓✓
Waste products discarded by consumers (litter) cause land pollution ✓✓
The use of plastic bags and other packaging which is then discarded causing
environmental damage ✓✓
Consumption also requires transport of goods for delivery as well as physical
spaces for consumers to buy goods and services which can negatively affect the
environment ✓✓
The consumption of cigarettes causes air pollution ✓✓
The consumption of electricity from coal-fired power stations causes the release
of greenhouse gases which causes air pollution✓✓
The consumption of water by households and industries can lead to a shortage
of water if consumption is irresponsible and does not take account of the need
to save water ✓✓
(Accept any other correct relevant answer)

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GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which
are not stated in the marking guidelines if they answer the question.
● 1 full sentence explaining one fact for 2 marks each must be given to get
maximum marks (1x2)(2).
● If two points are stated (not in full sentences), award a maximum of 1 mark.
● There may be a wide variety of answers here - read carefully and give credit
for answers which are correct but do not appear in the marking guideline.
● The answers must refer specifically to how CONSUMPTION can lead to
negative environmental impacts. If this link is not clear, award 1 mark
only.
● We do not award half marks in Economics.

Question 3.2

3.2.1 Name the economic model in the diagram above. (1)

Circular Flow ✓
Circular Flow Model ✓
Circular Flow Diagram ✓
Economic Circular Flow Diagram ✓
Economic Circular Flow Model ✓

GUIDANCE TO THE MARKER

● These are the only correct answers for this question.

● As the question verb is NAME, the answer does not have to be in a full
sentence.
● The learner MAY NOT DEFINE the economic circular flow or explain what
the concept refers to : if this is done, mark incorrect.
● We do not award half marks in Economics.

3.2.2 Identify any economic participant in the above diagram. (1)

Households ✓ / Consumers ✓
Businesses ✓ / Firms ✓ / Producers ✓

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GUIDANCE TO THE MARKER

● These are the only correct answers for this question.

● As the question verb is IDENTIFY, the answer does not have to be in a full
sentence.
● The learner MAY NOT DEFINE or explain one of the participants : if this is
done, mark incorrect.
● Award 1 mark for a correct answer.
● We do not award half marks in Economics.

3.2.3 Briefly describe the concept of real flow. (2)

The flow of goods and services and the factors of production through the
circular flow model ✓✓

GUIDANCE TO THE MARKER

● This is the only correct answer for this question.

● The answer must be in a full sentence.
● For a full definition in a full sentence, award 2 marks.
● For a partial answer / answer not in a full sentence, award 1 mark.
● The words “through the circular flow model” do not have to be present for
the learner to achieve full marks.
● If the learner mentions only factors of production (and not goods and
services), award 1 mark only.
● If the learner mentions only goods and services (and not factors of
production), award 1 mark only.
● We do not award half marks in Economics.

3.2.4 Explain the motivation of firms in the economic circular flow. (2)

The aim of the business is to make maximum profit ✓✓

Profit = Income - Expenses ✓
This means that the main goal is to make the expenses as low as possible and
the income as high as possible ✓✓
For a business as a producer, it means that the more production is taking place,
the higher the chances of earning an income on the goods and services they
produce ✓✓
They will respond to what the consumer wants or needs, and will produce
according to the demand of consumption ✓✓

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 (Accept any other correct relevant answer)

GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which
are not stated in the marking guidelines if they answer the question.
● The answer must be in a full sentence to obtain 2 marks.
● For partial answers / answers not in a full sentence, award 1 mark only.

● The key idea to look out for here is :

making a profit
through producing to meet the needs of consumers / demand

● We do not award half marks in Economics.

3.2.5 Why is the role of households so important in the above model? (2x2)(4)

Households are the primary owners of the factors of production.✓✓

They sell their factors of production on the factor market and they get
income in return ✓✓
They use the income they get through the factor market to buy goods and
services in the goods market ✓✓
thus putting their income back into the economy in the form of expenditure.
This income is taxed by the government so that the government receives
revenue or income from the household as a result. ✓✓
Households save a percentage of their income, thus providing funds for financial
institutions, which they can then lend out to businesses and other consumers to
spend or invest, thus stimulating economic activity ✓✓
They are the basic decision makers in the economy ✓✓
in establishing what is ultimately both produced and thus consumed ✓✓
Households determine what should be produced in the economy. ✓✓
Households or consumers have both needs and wants, and these need to be
met. ✓✓
The producers (business and government), therefore, seek to meet these needs
in what they produce. ✓✓
They consume what is produced and are thus responsible for consumption of
goods and services on the product market. ✓✓
(Accept any other correct relevant answer)

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GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which
are not stated in the marking guidelines if they answer the question.
● The answers must be in a full sentence to obtain 2 marks.
● For partial answers / answers not in a full sentence, award 1 mark only.
● 2 facts in full sentences x 2 marks each = 4 marks maximum.
● Award a maximum of 2 marks for answers which are merely stated.

● The key ideas to look out for here are :

households own the factors of production
households sell the factors of production for an income
households purchase goods and services and thus through their demand
determine what is produced
Households save and pay taxes thus providing funds for investment and
government expenditure

● We do not award half marks in Economics.

Question 3.3

3.3.1 Identify a factor from the extract above that could lead to an improvement
in the lives of South Africans. (1)
Economic growth ✓
Growth in the economy. ✓

GUIDANCE TO THE MARKER

● These are the only correct answers for this question.

● As the question verb is IDENTIFY, the answer does not have to be in a full
sentence.
● We do not award half marks in Economics.

3.3.2 Name one document mentioned in the extract that sets out the rights of
the South Africans. (1)
The Constitution ✓
Bill of rights ✓

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GUIDANCE TO THE MARKER

● These are the only correct answers for this question.

● As the question verb is NAME, the answer does not have to be in a full
sentence.
● We do not award half marks in Economics.

3.3.3 Briefly describe the concept of pollution. (2)

Pollution is the contamination of the environment with dirty and harmful
substances✓✓
It is poisonous gases and contaminants emitted into the environment
✓✓
The presence in or introduction into the environment of a substance
which has harmful or poisonous effects.✓✓
Pollution is the introduction of contaminants into the natural
environment that cause adverse change.✓✓
(Accept any other correct relevant answer)

GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which
are not stated in the marking guidelines if they answer the question.
● The answer must be in a full sentence to obtain 2 marks.
● For partial answers / answers not in a full sentence, award 1 mark only.
● Award a maximum of 1 mark for an example of pollution.
● There may be a wide variety of answers here, so read carefully and award
marks for relevant answers - ensure accurate and fair marking.
● The key ideas to look out for here are :
harmful substances being introduced into the environment
leading to damage of the environment
● We do not award half marks in Economics.

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3.3.4 What does this statement “South Africans gained many rights that had
previously been withheld from them” mean? (2)
This statement indicates that many South Africans were oppressed before the
advent of democracy in 1994 and could not enjoy any rights that are enshrined
in the Consultation of the New South Africa ✓✓
Before 1994 the majority of South Africans did not enjoy basic human rights, but
since 1994 they have been able to enjoy these rights as set out in the
Constitution and Bill of Rights ✓✓
Under apartheid the majority of South Africans were denied basic rights, but
after 1994 they had access to these rights ✓✓
(Accept any other correct relevant answer)

GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which
are not stated in the marking guidelines if they answer the question.
● The answer must be in a full sentence to obtain 2 marks.
● For partial answers / answers not in a full sentence, award 1 mark only.
● The question has two parts : denial of rights to the majority of South
Africans before 1994 and then access to rights after 1994 - ensure that both
elements are in the answer of learners in order for them to obtain the full 2
marks. If only one element of the answer is present, award 1 mark only.
● The key ideas to look out for here are :
apartheid denied human rights to the majority of South Africans before
1994
After 1994 the Constitution and Bill of rights ensured that basic human
rights were enjoyed by all South Africans
● We do not award half marks in Economics.

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3.3.5 Differentiate between the right to basic education and the right to basic
standard of living. (2x2)(4)

The right to basic education Access to basic standard of living

All South Africans have the right to basic The government has committed itself to
education and the right to learn skills improving living conditions and standards
and obtain training, which will help of living of all its citizens and is trying to
them to get jobs and become productive provide houses, water, electricity,
members of the economy.✓✓ pensions, food and health care for
Everyone has the right to a basic all.✓✓
education, including adult basic The right to an adequate standard of living
education. ✓✓ requires that everyone shall enjoy the
Every person – child, youth and adult – necessary subsistence rights: adequate
shall be able to benefit from food and nutrition, clothing, housing
educational opportunities designed to and the necessary conditions of care
meet their basic learning needs. ✓✓ when required. ✓✓
Everyone shall be able to be a full
participant in ordinary, everyday
interaction with other people. ✓✓
An adequate standard of living implies
living above the poverty line, ✓✓
which includes the expenditure
necessary to buy a minimum standard
of nutrition and other basic necessities
✓✓

(Accept any other correct relevant answer)

GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which
are not stated in the marking guidelines if they answer the question.
● 2 full sentences each explaining one fact for 2 marks each must be given to
get maximum marks (2x2)(4) : 2 marks for explaining the right to a basic
education and 2 marks for explaining the right to a basic standard of living.

19
 ● If four points are stated (not in full sentences), a maximum of 2 marks may
be awarded (1 mark for the right to a basic education and 1 mark for the
right to a basic standard of living).
● There may be a wide variety of answers here - read carefully and give credit
for answers which are correct but do not appear in the marking guideline.
● The answers must refer specifically to WHAT the rights to a basic education
and a basic standard of living entail.
● Key ideas to look out for here include :
basic education : access to knowledge and skills
basic standard of living : basic needs for survival are met : food, shelter,
water and security
● We do not award half marks in Economics.

3.4 Briefly describe TWO categories of consumer goods. Provide examples in

your answers. (2x4)(8)
Durable goods ✓
Durable goods are durable, meaning they do not easily wear out ✓✓
These goods can be used for long periods of times, and over and over again ✓✓
Examples include cars and vehicles, houses ✓
Semi-durable goods ✓
These goods can be used for a quite a while, but for a shorter time than durable
goods ✓✓
For context, a car can be used for about 6 - 10 years (durable), whereas a pair of
shoes (semi-durable) can be used for a season or two ✓✓
Non-durable goods ✓
Goods that can only be used once. It has no duration of time, as soon as you use
it, it is finished ✓✓
Examples include food, matches, petrol, cigarettes ✓
Services ✓
A service is consumed when a professional who is skilled at a specific task,
renders this task for the consumer ✓✓
Consumers can also consume services, such as banking and insurance ✓
They can also consume personal services like hairdressing, doctors, dentists ✓
There are also government services like transport and health care ✓
(Accept any other correct relevant answer)

20
 GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which
are not stated in the marking guidelines if they answer the question.
● 1 fact stated in a full sentence for 2 marks for each category of goods must
be given + naming the good (1 mark) + an example (1 mark) to award full
marks for each category (4 marks).
● A maximum of 4 marks for each type of good may be awarded.
● Award 1 mark for naming the type of good.
● If a partial explanation is given / answer is not in a full sentence, award 1
mark.
● 1 mark for an example of each type of good may be awarded.
● Award a maximum of 2 marks for examples (1 for each type of good only).
● Award a maximum of 4 marks for facts merely stated and not explained (2
facts for each type of good).
Example of how the 4 marks are obtained :
1 mark for naming the category of good
2 marks for the explanation
1 mark for an example
● if no examples are given a maximum of 3 marks can be obtained, as
examples are specifically asked for in the question.
● if the category of goods is not named / listed / given within the sentence, but
the explanation and examples are given, a maximum of 3 marks per
category of goods can be obtained.
● We do not award half marks in Economics.

3.5 How do households contribute towards the growth of the economy? (4x2)(8)
• households are the owners of the factors of production. They provide
these factors to producers so that they can produce goods and services
and expanded production leads to economic growth✓✓
• households pay income tax to the government, who in turn use the tax
revenue to provide public goods such as infrastructure ✓✓
• the provision of public goods and services is an injection into the
economy, leading to economic growth through the provision
infrastructure, job creation and skills development ✓✓
• households buy goods and services from business, thereby providing an
income to the businesses ✓✓
• This allows businesses to expand, invest and grow their businesses,
providing jobs and innovation which leads to economic growth✓✓

21
 • households save some of their income in financial institutions like banks
and these invest this money back into the economy through loans to
businesses and government which leads to economic growth ✓✓
• Households begin the production, exchange and consumption process
through the sale of their factors of production which is the foundation of
economic growth✓✓
(Accept any other correct relevant response)

GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which
are not stated in the marking guidelines if they answer the question.
● 4 facts stated in full sentences for 2 marks each must be given to award full
marks.
● If a partial explanation is given / answer is not in a full sentence, award 1
mark.
● 1 mark for an example which is stated.
● 2 marks for a fully explained example.
● Award a maximum of 2 marks for examples.
● Award a maximum of 4 marks for facts merely stated and not explained.
● The key ideas to look out for here are :
households provide factors of production to businesses, pay taxes, save part
of their income and purchase goods and services
these actions can lead to economic growth
● In order to be awarded 2 marks per point, make sure that there is a clear
LINK between the role of the household and economic growth. If this link is
not clear, award 1 mark only.
● Learners may struggle to make this connection so read carefully to ensure
accurate and fair marking.
● We do not award half marks in Economics.

Total Section B: 40

22
QUESTION 4 40 MARKS

Discuss the phases of the business cycle in detail. (26 marks)

Critically discuss how the Covid-19 lockdowns affected the South African
business cycle. (10 marks)

INTRODUCTION (1x2=2)
Business cycles are consecutive periods of increasing and decreasing economic
activities✓✓
(Accept any other correct relevant answer)

GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which are
not stated in the marking guidelines if they answer the question.
● The introduction must be written in a full sentence. This is a lower-order part
of the question, where the main concept of the essay topic is defined.
However, any relevant fact to do with the topic may be accepted as correct.
● Do not give marks for any part of the question that is repeated in the
introduction.
● Do not give marks for repetition of any part of the introduction in the body
copy.
● Do not give marks when learners state in the introduction what they are going
to discuss in the body. For example, ‘In this essay I will discuss the causes of
business cycles…’
● 1 mark may be given for an incomplete statement, but generally, as this is a
lower-order component, 2 marks are awarded for a full sentence that is
related to the topic under discussion.
● This is a lower-order element of the question so any fully explained sentence
which discusses business cycles or any concepts related to business cycles
may be awarded two marks.
● Please add a comment for learners that do not get 2 marks indicating why and
what they could perhaps have written to get two marks.
● We do not give half marks in Economics.

Body
MAIN PART (26 marks)

23
Prosperity phase ✓ (3x2)(6)
• Optimism encourages entrepreneurs to borrow money and to buy new
machinery and equipment✓✓
• More people are employed and production increases✓✓
• Prices, wages, interest rates and profits increase✓✓
• Factories work over-time and skilled labour becomes extremely scarce✓✓
• When the boom starts everything seems to go to the extreme✓✓
• Interest rates, salaries and wages increase to even higher levels
• There is a much greater demand for raw materials, cost of businesses increases
almost beyond control✓✓
• Inflation accelerates beyond previous higher levels✓✓
• Some businesses start to realise that the prosperity phase cannot last forever,
but there are no clear disturbances yet✓✓

The recession phase ✓ (3x2)(6)

• Businesses start to provide for bad times by producing less and trying to repay
the larger part of their loans✓✓
• They selectively lay off workers✓✓
• Spending by households and profits of businesses start to decrease✓✓
• Initially inflation is high and the central bank reduces the quantity of money and
credit in the economy, and increases interest rates✓✓
• In other words, the central bank applies a stricter monetary policy✓✓
• Households find it difficult to afford to buy goods on credit and to pay bonds,
and banks insist that business enterprises repay the loans that were granted
during the boom✓✓
• Spending on durable consumer goods and capital equipment is greatly reduced
and unemployment increases✓✓
• Some businesses start to show losses✓✓
• As the recession progresses the central bank decreases interest rates to
increase the quantity of money and credit in the economy ✓✓
• Households and businesses become increasingly pessimistic (negative) about
the economy ✓✓

The depression phase ✓ (3x2)(6)

• This phase is characterised by general pessimism (expecting the worse) by
households and businesses✓✓
• The spending of all sectors in the economy decreases drastically and consists
mainly of expenditure on consumer goods✓✓
• Businesses show poor profits, many make losses, and some go bankrupt✓✓

24
• Households that cannot pay their debts have their furniture, motorcars, and
even their houses repossessed✓✓
• Many people find work in the informal sector✓✓
• The aim of many households is to provide for their basic needs ( food, shelter
and clothing)✓✓
• Because of reduction in demand, inflation also decreases and interest rates
fall✓✓
• At a certain stage businesses start to realise that conditions are going to
improve at some time, and they take the first actions that will eventually lead to
the recovery✓✓

The recovery phase ✓ (3x2)(6)

• Businesses realise that conditions are going to improve and start to service their
machinery and improve their equipment✓✓
• They increase their production slightly to provide stock for a possible increase in
demand✓✓
• They make better use of their labour and even employ new workers✓✓
• Because businesses purchase more goods and services and employ a greater
number of people, there is an increase in income and spending in the
economy✓✓
• Because interest rates are low, household bond repayments and other
instalments are low, and so households have more money to spend✓✓
• Loans are available but households and business enterprises are still not keen
to borrow✓✓
• As soon as sales improve, business profits increase✓✓
• Entrepreneurs become more optimistic✓✓
` (Accept any other correct relevant response)

GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which are
not stated in the marking guidelines if they answer the question.
● Subheadings : 1 mark (max 8 marks)
● Examples : 1 mark
● Examples fully explained (in context) : 2 marks.
● Full sentences must be written in order to obtain 2 marks per point.

● Mark subheadings first up to a maximum of 8 marks and then :

25
 (3x2=6) for each phase x 4 phases = (24 marks)
+ 2 marks from one of the phases
= 26 max

● Learners may still obtain the maximum marks even if there are no
subheadings.
● Take note of the submaxima for each subheading (3x2)(6).
● For one of the phases you will allocate 8 marks to arrive at the total of 26
marks for the main part of the body.
● Guard against accepting information under a particular heading just because
it is vaguely related to the question. Sometimes the information does not
relate to the question asked, so always refer back to the question to ensure
the content is relevant for the particular subheading.
● We do not give half marks in Economics.

ADDITIONAL PART (5x2=10)

Critically discuss how the Covid-19 lockdowns affected the South African
business cycle.

During the pandemic, one of the worst things that happened was that many
people lost their jobs because the economy (business cycle) went into a
recession due to a decline in consumption (demand) and production ✓✓
Businesses laid off staff or close and thus many people lost their incomes ✓✓
With lower incomes, consumers had to reduce their spending which further
reduced the demand for goods and services ✓✓
As business struggled to cope with the drop in demand, they had to find ways to
reduce their costs and so they ordered less from suppliers and reduced their
staff numbers ✓✓
In August 2021 South Africa had an unemployment rate of 34.4% which indicates
that the economy was in a recession ✓✓
Economic growth declined and the Central Bank (SARB) dropped interest rates
so that consumers could have a better chance of meeting their debts
repayments ✓✓
Due to COVID19 we moved into a period of recession ✓✓
This shows negative economic growth for two consecutive quarters ✓✓
Businesses need to compensate for the worst times ✓✓
So now they reduce production because consumer spending is decreasing. This causes
an acceleration in the downswing ✓✓

26
Businesses start to selectively lay off workers in order to account for the costs ✓✓
Some businesses had to close down; some businesses had to lay off workers ✓✓
Some businesses couldn't pay their workers, so unemployment increases when workers
are laid off ✓✓
As the spending of consumers decreases the profits of businesses also decreases ✓✓
Inflation is still very high after the boom / prosperity phase ✓✓ and therefore the
central bank reduces the interest rate ✓✓ and decreases the quantity of money and
credit in the economy ✓✓
This means that the central bank applies stricter monetary policy ✓✓
We then after recession move into a period of depression - output just continues to fall
under the period of a year ✓✓
This phase is characterised by a feeling of general depression by businesses, they
expect the worst to happen ✓✓
Spending all over the economy decreases drastically ✓✓
With COVID-19, people lost their jobs, meaning that they have less money to spend
meaning that they will stop spending ✓✓
They will start spending their money on goods that they need to survive ✓✓
Households experienced the depression phase through the inability to pay off their
debt and the bank repossessed their assets, such as cars, houses and furniture ✓✓
Many jobs are lost and consumers have very low incomes ✓✓
Consumers only focus on the basics. Demand decreases as consumers only want the
necessities ✓✓
(Accept any other correct relevant response)

GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which are
not stated in the marking guidelines if they answer the question.
● Examples : 1 mark
● Examples fully explained (in context) : 2 marks.
● Full sentences must be written in order to obtain 2 marks per point.
● For this question you will get a wide variety of answers. Read carefully to
make sure that the answers relate to the impact of Covid-19 lockdowns on
the economy (business cycle)
● Guard against accepting information just because it is vaguely related to the
question. Sometimes the information does not relate to the question asked,
so always refer back to the question to ensure the content is relevant.

27
CONCLUSION (1x2)(2)
Authorities must always monitor the economic growth patterns, so that
upswings may be prolonged and downswings shortened, if not avoided.✓✓
(Accept any other correct relevant response)

GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which are
not stated in the marking guidelines if they answer the question.
● The conclusion is marked as follows:
● This is a higher-order question and must show insight and provide
perspective. The current situation with regards to the South African economy
as related to the essay topic may be discussed. A critical analysis of the essay
topic may be given.
● Future predictions and policy suggestions, based on sound theoretical
frameworks, may be given.
● Do not give marks for repeating content from the introduction or body.
● Give 1 mark only for a lower-order statement of fact that does not show
interpretation, analysis, or higher-order cognitive application.
● The conclusion may relate to the main part or additional part of the essay.
● Marks can be allocated for the following in the conclusion :
● A brief summary of what has been discussed without repeating facts already
mentioned.
● Any opinion or value judgement on the facts discussed.
● Additional support information to strengthen the discussion/analysis.
● A contradictory viewpoint with motivation.
● Recommendations.
● Read carefully to assess whether the conclusion is a higher order
statement and can be awarded 2 marks.
● Many learners struggle to get 2 marks for the conclusion, especially at Grade
10 level, but many will get at least 1 mark.
● Remember that the conclusion can relate to the main or additional part of the
body.
● Please add a comment for learners that do not get 2 marks indicating why and
what they could perhaps have written to get two marks.
● We do not give half marks in Economics.

[40]

28
QUESTION 5 40 MARKS

Discuss in detail the four participants in the economy and the interactions between
these participants. (26 marks)

How can injections contribute towards an economic upswing? (10 marks)

INTRODUCTION (1x2)(2)
The circular flow model is a simplified representation of the interaction between the
participants of the economy ✓✓
The flows of goods and services and money, in opposite directions between consumers,
enterprises, the public sector and the foreign sector ✓✓
(Accept any other correct relevant answer)

GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which are
not stated in the marking guidelines if they answer the question.
● The introduction must be written in a full sentence. This is a lower-order part
of the question, where the main concept of the essay topic is defined.
However, any relevant fact to do with the topic may be accepted as correct.
● Do not give marks for any part of the question that is repeated in the
introduction.
● Do not give marks for repetition of any part of the introduction in the body
copy.
● Do not give marks when learners state in the introduction what they are going
to discuss in the body. For example, ‘In this essay I will discuss the causes of
business cycles…’
● 1 mark may be given for an incomplete statement, but generally, as this is a
lower-order component, 2 marks are awarded for a full sentence that is
related to the topic under discussion.
● This is a lower-order element of the question so any fully explained sentence
which discusses business cycles or any concepts related to business cycles
may be awarded two marks.
● Please add a comment for learners that do not get 2 marks indicating why and
what they could perhaps have written to get two marks.
● We do not give half marks in Economics.

29
Body
MAIN PART (26 MARKS)

Households✓ (3x2)(6)
• All the people who live together and make joint economic decisions✓✓
• A family is a household sharing income✓✓
• They own factors of production, which are labour, entrepreneurship, land and
capital✓✓
• They own businesses through the shares they have in businesses.✓✓
• They also earn an income from factors of production,✓✓ e.g. labour earns
salaries and wages, interest is paid on capital, rent is paid for land, and profit is
the reward for entrepreneurial activities✓
• They use their income to buy goods and services from producers✓✓
• The main aim for consumers is to maximise their satisfaction.✓✓
• Through their income and spending they determine what must be produced, for
whom goods and services must be produced, and how it must be produced✓✓
• What households want and can afford (their demand) determines what business
will produce✓✓
• Households also save a portion of their income for various reasons for their
future✓✓

The role of the household

● The household is referred to as the consumer in the circular flow. (This is where
you are considered a participant). ✓✓
● The households are the owners of the factors of production (land, labour, capital
and entrepreneurship) ✓✓ and sell these on the factor market to the business
and government. ✓✓ They sell these factors of production in the real flow. ✓✓
● The household sells the factors of production in return for income (rent, wages,
interest and profit). They receive this income in the money flow. ✓✓
● This income is taxed by the government so that the government receives
revenue or income from the household as a result. ✓✓
● The household then purchases other goods and services on the product market,
✓✓ provided for by the government and businesses, thus putting their income
back into the economy in the form of expenditure. ✓✓

Primary function of the household

Households determine what should be produced in the economy. ✓✓
Households or consumers have both needs and wants, and these need to be

30
 met. ✓✓
The producers (business and government), therefore, seek to meet these needs
in what they produce. ✓✓
Households consume what is produced and are thus responsible for
consumption of goods and services on the product market. ✓✓
They are the basic decision makers in the economy in establishing what is
ultimately both produced and thus consumed. ✓✓

The motivation of the household

The reason that the household sells their factors of production is in order to
receive an income and improve their standards of living. ✓✓ This income is vital
for them to be participants in the economy. ✓✓

Business Enterprises✓ (3x2)(6)

• They produce goods and services using factors of production✓✓
• Production in SA is mostly done by the privately owned business✓✓
• Business / Firms are important decision-makers in our economy, they also
produce capital goods✓✓
• Capital goods are used in the production of consumer goods✓✓
• Creation of capital goods is called Investment (I)✓✓
• Businesses are responsible for efficient production✓✓
• Businesses pay households wages / salaries for labour, interest for capital, rent
for land, profits for entrepreneur as income for their factors of production.✓✓
• They bear the production costs✓✓

The role of the business sector

● The business sector is the producer in the economy. ✓✓
● The business purchases the factors of production from the household on the
factor market. ✓✓
● The business pays the household in the form of income for these factors of
production. ✓✓
● The business produces goods and services on the product market with these
factors of production for both the household and the government. ✓✓
● The business pays the government tax on the income received for selling these
goods and services on the product market. ✓✓

The primary function of the business

31
 The business sector transforms the factors of production from the factor market
into final products or goods and services, ✓✓ which it then sells on the product
market. It is thus responsible for basic production in the economy. ✓✓

The motivation of the business sector

The aim of the business is to make maximum profit. ✓✓ Profit = Income -
Expenses. ✓✓ This means that the main goal is to make the expenses as low as
possible and the income as high as possible. ✓✓ For a business as a producer, it
means that the more production is taking place, the higher the chances of
earning an income on the goods and services they produce. ✓✓ They will
respond to what the consumer wants or needs, and will produce according to
the demand of consumption. ✓✓

Public Sector / Government / The State ✓ (3x2)(6)

• They comprise of local, provincial and national government✓✓
• Government purchases factors of production from households in the factor
market✓✓
• The state also purchases goods and services from firms in the good markets✓✓
• They also provide households and business enterprises with goods and services,
which are not produced by businesses✓✓
• These public goods include safety, defence, law, roads and other
infrastructure✓
• Receive tax from households and businesses, and also receive revenue from
state owned enterprises✓✓
• The state spends tax revenue on social services✓✓
• Examples of tax on goods and services paid by consumers include Value Added
Tax (VAT), sin tax and fuel levies✓

The role of the public sector in the economy

The government or public sector has a role to provide goods and services to the
households (citizens of a country). ✓✓ In South Africa, we have numerous goods and
services that are provided for by the government. ✓✓ The goods and services that are
provided for are ones that are not adequately provided for by the business sector. ✓✓
The government is thus also responsible for production in the economy. ✓✓
Goods and services that the government provides are referred to as public goods and
services, and include healthcare, education, and water. ✓✓

The primary function of the government

32
The government's main role is to ensure that the most basic needs and services are
supplied to its citizens. ✓✓ It therefore supplies public goods (goods produced by the
government), which are not adequately provided for by the business sector (private
sector) to the citizens in a country in order to meet these needs. ✓✓

Not only must the government ensure these basic needs are met, but also that the
public resources used to do so are not diminished (used up). ✓✓ It needs to
sustainably meet these needs and not use up resources that cannot be replenished to
do so. ✓✓ For example, South Africa's water reserves need to be carefully monitored
and looked after, ensuring that all South Africans have access to clean water. The role is
not to give everyone access to clean water for one day and then it is all gone, instead
the government will constantly ensure that all have access to sufficient amounts of
water, but also that it is not used up. ✓✓

The government has to achieve its five economic goals, namely:

● Economic growth ✓
The objective is to ensure an increase in the real Gross Domestic Product ✓✓
The more productive an economy is (the more it produces), the higher the ability
for consumption as more people will have access to jobs ✓✓
● Full employment ✓
All citizens that can and are willing to work have employment. This increases
consumption ✓✓
● Economic equity (reasonable division of income) ✓
In order to have a fair (equitable) economy, there is a redistribution of wealth by
taxing higher income groups more on their income, and lower income groups
less ✓✓
This ensures that the government can finance social services like education and
healthcare, ensuring that all citizens have access to these services ✓✓
● Price stability (low inflation) ✓
The inflation rate needs to remain low, between 3 - 6% in order for the economy
to function effectively, ✓✓
keeping production costs and thus price of products stable and as low as
possible enables more room for consumption ✓✓
● Balance of payment and exchange rate stability ✓
The Balance of payment is the country's recorded transactions with other
countries ✓✓
The government must ensure exchange rate stability ✓✓
For example, if the dollar value increases, there must be some plan in place to

33
 ensure that the country can still have access to resources, goods or services
purchased in dollars even with the price increase. ✓✓

The motivation of the government

The main objective of the public sector is to serve the public (the citizens). ✓✓
It aims to ensure that the basic needs of all its citizens are met, ✓✓ by seeing gaps in
service and product delivery. ✓✓ For example, if the private sector was no longer
farming potatoes but the citizens relied on them as a major food group, then the
government would intervene to ensure the production of potatoes continued for its
citizens. This would be done by either farming them itself, or by funding the private
sector to encourage them to produce potatoes. ✓✓

In order for the government to provide these goods and services, it needs revenue
(income). ✓✓ This revenue is received when households and businesses purchase
goods and services it provides, ✓✓ and from taxation on goods and services sold, ✓✓
and taxation on income that businesses and households receive. ✓✓

Foreign Sector✓ (3x2)(6)

• Represents trading with the rest of the world, export / import trade –
international trade✓✓
• The world has become a global village✓✓
• Changes in one part the village affects many other parts of the village✓✓
• Changes in real flows and financial flows, technology and information occur
between countries✓✓
• Globalisation means there is higher integration between countries✓✓
• Export earnings are injections, as money is received from other countries✓✓
• Import payments, are leakages since money leaves the country✓✓
The role of the foreign sector in the economy
The foreign sector refers to all international trade or transactions that take place
between countries or over political borders. ✓✓

The primary function of the foreign sector

Given the geographical layout of our world, certain resources are located in specific
regions, and sometimes, only in certain locations. ✓✓
These resources have become vital parts of our functioning economies and daily lives.
✓✓
For example, oil and coal are resources used to generate petrol and electricity
respectively. Some coal resources are located in South Africa, but some other countries
such as China and India do not have access to coal. They have thus needed to purchase

34
this coal from us so that they too can have access to generating electricity. ✓✓
Oil is a resource that South Africa does not have, therefore, it needs to import it from
other countries, namely Saudi Arabia. ✓✓
Both of these resources are used for the production of resources into final products
and are, therefore, essential natural resources in order for production to take place.
✓✓

The motivation of the foreign sector

The economic problem of scarcity is the main motivation for countries to exchange
resources. ✓✓
A lack of certain resources and an inability to produce these goods and services without
them or on their own is ultimately the reason countries have decided to trade with one
another: ✓✓ in order to solve the problem of scarcity. ✓✓

Certain countries then have a deficit of goods, services and resources, where other
countries may have a surplus. ✓✓
Therefore, they export their surplus resource or goods and services, and import where
they have a lack of either resource or goods and services. ✓✓

The household, business sector, and the government can be positively or negatively
impacted by the foreign sector interaction. ✓✓
For example, think of items you have purchased that were made in different countries.
✓✓
You, as the household, could also in turn have access to a wider range of goods and
services worldwide. ✓✓
This means that the household could also have access to job opportunities globally, not
just the ability to buy global products. ✓✓
The business could enlarge its client base to the rest of the world, imagine the impact
this would have on the productivity of the business. ✓✓

(Accept any other correct relevant response)

GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which are
not stated in the marking guidelines if they answer the question.
● Subheadings : 1 mark (max 8 marks)
● Examples : 1 mark

35
 ● Examples fully explained (in context) : 2 marks.
● Full sentences must be written in order to obtain 2 marks per point.

● Mark subheadings first up to a maximum of 8 marks and then :

(3x2=6) for each participant x 4 participants = (24 marks)
+ 2 marks from one of the participants
= 26 max

● Learners may still obtain the maximum marks even if there are no
subheadings.
● Take note of the submaxima for each subheading (3x2)(6).
● For one of the participants you will allocate 8 marks to arrive at the total of 26
marks for the main part of the body.
● Guard against accepting information under a particular heading just because
it is vaguely related to the question. Sometimes the information does not
relate to the question asked, so always refer back to the question to ensure
the content is relevant for the particular subheading.
● We do not give half marks in Economics.

ADDITIONAL PART (5X2=10)

How can injections contribute towards an economic upswing?

An injection occurs when money is added to the circular flow ✓✓

This consists of exports ✓, government expenditure ✓ and investment ✓
Investment includes buying capital goods, equipment & machinery ✓✓
Investment leads to more jobs being created as production expands ✓✓
Improvement in the standard of living of people in the economy thus occurs
✓✓
Both exports and investments lead to more money flowing into SA, ✓✓ or
more production in SA ✓✓
thereby benefiting the SA economy ✓✓
Exports are when goods and services leave the country ✓✓
Payment for these goods and services flows into the country and are injected into the
circular flow ✓✓
Government expenditure as an injection benefits the economy through the
construction, improvement and maintenance of infrastructure ✓✓
such as roads and railways as well as social infrastructure such as schools and hospitals
✓✓
Government expenditure on social grants improves people’s lives ✓✓

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and stimulates the economy through enabling households to increase their expenditure
and demand for goods and services ✓✓
(Accept any other correct relevant response)

GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which are
not stated in the marking guidelines if they answer the question.
● Examples : 1 mark
● Examples fully explained (in context) : 2 marks.
● Full sentences must be written in order to obtain 2 marks per point.
● For this question you will get a wide variety of answers. Read carefully to
make sure that the answers relate to how INJECTIONS lead to an UPSWING
- in order to obtain 2 marks per point this link must be clear.
● If the above link is not clear, in other words, learners talk about injections only
- award 1 mark.
● A maximum of 3 marks may be awarded for naming the three injections.
● A maximum of 2 marks may be awarded for defining an injection.
● Guard against accepting information just because it is vaguely related to the
question. Sometimes the information does not relate to the question asked,
so always refer back to the question to ensure the content is relevant.
● We do not award half marks in Economics.

CONCLUSION (1x2=2)
The economic participants are dependent on each other. An economy cannot be
functional if one of the participants does not play their role.✓✓
In order for economic growth and development to take place, injections must be greater
than leakages ✓✓
The government should strive to ensure economic stability through its policies so that
injections increase and economic growth occurs ✓✓
(Accept any other correct relevant answer)

GUIDANCE TO THE MARKER

● For questions such as this one where the words “accept any other correct
relevant answer” appear, please read answers carefully to make sure you
have read with understanding. You may accept as correct answers which are
not stated in the marking guidelines if they answer the question.
● The conclusion is marked as follows:

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● This is a higher-order question and must show insight and provide
perspective. The current situation with regards to the South African economy
as related to the essay topic may be discussed. A critical analysis of the essay
topic may be given.
● Future predictions and policy suggestions, based on sound theoretical
frameworks, may be given.
● Do not give marks for repeating content from the introduction or body.
● Give 1 mark only for a lower-order statement of fact that does not show
interpretation, analysis, or higher-order cognitive application.
● The conclusion may relate to the main part or additional part of the essay.
● Marks can be allocated for the following in the conclusion :
● A brief summary of what has been discussed without repeating facts already
mentioned.
● Any opinion or value judgement on the facts discussed.
● Additional support information to strengthen the discussion/analysis.
● A contradictory viewpoint with motivation.
● Recommendations.
● Read carefully to assess whether the conclusion is a higher order
statement and can be awarded 2 marks.
● Many learners struggle to get 2 marks for the conclusion, especially at Grade
10 level, but many will get at least 1 mark.
● Remember that the conclusion can relate to the main or additional part of the
body.
● Please add a comment for learners that do not get 2 marks indicating why and
what they could perhaps have written to get two marks.
● We do not give half marks in Economics.

[40]
Total Section C: 40

MEMORANDUM END

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