TSHWANE WEST DISTRICT COMMON EXAM

2023 FINAL EXAMINATION

GRADE 10

ECONOMICS PAPER 1

16 NOVEMBER 2023

MARKING GUIDELINES

MARKS: 150
TIME: 2 HOURS
EXAMINER: PLC PAPER
INTERNAL MODERATOR : PLC Members

This marking guideline consists of 18 pages including the cover page.

1
SECTION A (COMPULSORY)
QUESTION 1

1.1 MULTIPLE-CHOICE QUESTIONS

1.1.1 C 🗸🗸 (Limited)

1.1.2 A 🗸🗸 (Opportunity cost)

1.1.3 C 🗸🗸 (Leakages)

1.1.4 D 🗸🗸 (Trough)

1.1.5 A 🗸🗸 (Khoisan)

1.1.6 B 🗸🗸 (Self-sufficiency)

1.1.7 B 🗸🗸 (Electronic banking)

1.1.8 D 🗸🗸 (Census) (8 x 2) (16)

1.2 MATCHING ITEMS

1.2.1 I 🗸 (The physical and mental efforts of human activities used in the production of
goods and services)

1.2.2 E 🗸 (The system of exchanging goods with other goods in the absence of money)

1.2.3 B 🗸 (The period of high economic activities)

1.2.4 G 🗸 (The increase in the standard of living)

1.2.5 H 🗸 (A sector where raw material is manufactured into final goods)

1.2.6 A 🗸 (Equal opportunities for all people in the workplace)

1.2.7 D 🗸 (A statement based on facts which can be proven)

1.2.8 C 🗸 (The flow of money in the circular flow) (8 x 1) (8)

2
1.3 GIVE ONE TERM

1.3.1 Entrepreneur 🗸

1.3.2 Open economy 🗸

1.3.3 Endogenous / Keynesians 🗸

1.3.4 Urbanisation 🗸

1.3.5 Life expectancy 🗸

1.3.6 Primary sector 🗸 (6 x 1) (6)

TOTAL SECTION A: 30

3
SECTION B
Answer any TWO of the three questions in this section in the ANSWER BOOK.

QUESTION 2: MACROECONOMICS.

2.1 Answer the following questions.

2.1.1 Name any TWO field of study related to Economics.
• Accounting 🗸
• Business studies 🗸
• Commercial law 🗸
• Mathematics of finance 🗸 (2 x 1) (2)
(Accept any other correct relevant response)

2.1.2. Why is Economics referred to as social science?

• Economics studies human behaviour e.g., social psychology, sociology,
and political science. 🗸🗸
• Economics studies how people make decisions in order to solve their
scarcity problems. 🗸🗸
• Economics is a social science because it focuses on the analysis of people
and their behavior. 🗸🗸
(Accept any other correct relevant response) (2)
DATA RESPONSE
2.2.1 Identify the economic problem faced by Mr Adams
• Absolute scarcity. 🗸 / Scarcity. 🗸 (1)
2.2.2. Mention any ONE need that Mr Adams cannot meet for the month of
December.
• Buying grocery. 🗸
• Pay municipality. 🗸
• Pay insurance policy. 🗸 (1)
2.2.3 Briefly describe the concept opportunity cost.
• Opportunity cost refers to the value of the next best option/ alternative
which is not chosen. 🗸🗸
• Opportunity cost refers to the loss of other alternatives when one alternative
is chosen. 🗸🗸
(Accept any other correct relevant response) (2)

2.2.4 Briefly explain how efficiency is achieved

• Efficiency is achieved when economic resources are used optimally. 🗸🗸
(Accept any other correct relevant response) (2)

2.2.5. How does absolute scarcity differ from relative scarcity?

• Absolute scarcity exists when it is not possible to increase the supply of a
good, because resources are finite. 🗸🗸
• Relative scarcity is when you choose resources to do one thing instead of
another. 🗸🗸
(Accept any other correct relevant response) (2 x 2) (4)

4
 DATA RESPONSE

2.3.1. Identify the method used in the table above to calculate GDP
• Expenditure method. 🗸 (1)

2.3.2. Name any other method used to calculate the GDP

• Income. 🗸
• Production. 🗸 (1)

2.3.3 Briefly describe the concept Gross Domestic Product.

• Gross Domestic Product refers to the total value of all final goods and
services produced within the borders of a country in a given time, usually
one year. 🗸🗸
(Accept any other correct relevant response) (2)
2.3.4. Why are imports subtracted when calculating GDP?
• Imports are substituted because it represents the amount of money paid
when buying goods from other countries. 🗸🗸
(Accept any other correct relevant response) (2)

2.3.5. Determine the value of Gross Domestic Product (A) (Show all
calculations)
Consumption expenditure by Households = 1 253 🗸
+Consumption expenditure by the government = 303
+Investment = 864 🗸
+Exports = 539
-Imports = 720 🗸
=Gross Domestic Product (GDP) = 2 239 🗸
(4)

2.4. Tabulate the differences between Macroeconomics and Microeconomics

Macroeconomics Microeconomics
• Macroeconomics refers to the • Microeconomics refers to the study of
study of the economy as a individual consumer, households, or
whole 🗸🗸 firms. 🗸🗸

• It focuses on the economic • Focuses on the supply and demand

behaviour of a society. 🗸🗸 decision of individual 🗸🗸

(Accept any other correct relevant response) (2 x 4) (8)

5
2.5. How do business cycle fluctuations affect employment in the economy?

During downward (contraction)

• Businesses will start producing fewer goods and services. 🗸🗸
• Households will lose their jobs. 🗸🗸
• There will be less consumption of goods and services by households. 🗸🗸
• The government’s revenue from taxes will decline 🗸🗸
• Government will need to provide more public goods and services. 🗸🗸

OR

During Upward (expansion

• Businesses will start producing more goods and services which will result in
economic growth 🗸🗸
• More people will be employed. 🗸🗸
• There will be more consumption of goods and services by households. 🗸🗸
• The government’s revenue from taxes will increase 🗸🗸
• Government will need to provide less public goods and services 🗸🗸
(Accept any other correct relevant response) (Max 8)

6
QUESTION 3: ECONOMIC PURSUITS.

3.1 Answer the following questions.

3.1.1. Name TWO factors that determine the natural population growth rate.
• Birth rate. 🗸
• Death rate. 🗸 (2 X 1) (2)
(Accept any other correct relevant response)

3.1.2. How does economic growth relate to economic development?

• An increase in gross domestic product means more goods and services available
to the population 🗸🗸
• More people will be employed therefore this will increase the standard of living 🗸🗸
(Accept any other correct relevant response) (2)

DATA RESPONSE

3.2.1. Identify the type of trade depicted by the picture A above.

• Bartering / Barter trade / Barter. 🗸 (1)

3.2.2. What is the name of the currency used in South Africa?

• Rand. 🗸 (1)

3.2.3. Briefly describe the concept specialization.

• It is when a country /business focuses on the production of a certain
product to become more efficient. 🗸🗸
(Accept any other correct relevant response) (2)

3.2.4. Explain the role of Commercial Law in the evolution of markets.

• To set rules and regulations that govern commercial transactions between
people, firms, and government. 🗸🗸
(Accept any other correct relevant response) (2)

3.2.5. Explain how specialization had led to an increase in trade nationally

and internationally .
• Increased specialization led to surplus production, which resulted to trade
and transport. 🗸🗸
• The needs of people became diverse, which leads to an increase in
demand for goods and services. 🗸🗸
(Accept any other correct relevant response) (4)

7
 DATA RESPONSE
3.3.1. What is the total population size of South Africa according to the
above table?
• 60 624 976. 🗸 (1)

3.3.2. Identify the province with the least number of people from the above
table.
• Northern Cape. 🗸 (1)

3.3.3. Briefly explain the term population.

• Population refers to the number of people in a certain area. 🗸🗸
• Population refers to all the inhabitants of a particular place 🗸🗸
(Accept any other correct relevant response) (2)

3.3.4. Explain why Gauteng province is overcrowded.

• Gauteng is regarded as an economic hub of South Africa. 🗸🗸
• People flock to Gauteng in search of Job opportunities and better standard
of living. 🗸🗸
(Accept any other correct relevant response) (2)

3.3.5. Why is it important for the government to know what the population
growth rate is.
• In order for the government to conduct planning on resources that citizens
will require in future. 🗸🗸
• To allocate resources efficiently. 🗸🗸
• Resources like infrastructure, education, and health projects. 🗸🗸
(Accept any other correct relevant response) (4)

3.4. Briefly explain the evolution of limited liability companies.

• These companies are registered under the Company’s Act that prescribes
how they should raise their capital and operate . 🗸🗸
• Have limited liability . 🗸🗸
• Their shareholders are not liable for all of the company’s debt . 🗸🗸
• They are only liable for the amount that they have invested in the
company🗸🗸
• They have financial power; they can sell shares to the public 🗸🗸
• Are recognised by law as independent from their members with their own
powers and liabilities 🗸🗸
• Are controlled by an elected board of directors and managed by an
appointed management team 🗸🗸
• These companies have made and are still making huge contributions to
economic growth 🗸🗸
(Accept any other correct relevant response) (8)

8
3.5. Evaluate the impact of immigration on South African population.
• Immigration of skilled people addresses the demand for scarce skills and
expertise. 🗸🗸
• Conflicts surrounding migrant labourers taking jobs from SA citizens have
recently become apparent. 🗸🗸
• Huge inflow of illegal immigrants increases the population of S.A resulting
to an increase in financial burden to government. 🗸🗸
• Illegal immigrants and refugees add to the development of informal sectors.
🗸🗸
• Inflow adds to pressure on government to provide education and basic
health services. 🗸🗸
(Accept any other correct relevant response.) (8)
[40]

9
QUESTION 4: MACROECONOMICS AND ECONOMIC PURSUITS

4.1.1. List any TWO types of unemployment.

• Structural. 🗸
• Cyclical. 🗸
• Seasonal. 🗸
• Frictional. 🗸 (2 X 1) (2)

4.1.2. What effect will recession have on business activities.

• When recession starts, output, income and investment will decline. 🗸🗸
• Recession will lead to a decline in the profitability of the business causing
businesses to retrench their workers 🗸🗸 (1 x 2) (2)
(Accept any other correct relevant response)

DATA RESPONSE

4.2.1 Provide the above diagram with a suitable heading.

• Business cycle. 🗸 (1)

4.2.2 Identify the highest turning point from the above diagram.
• Peak. 🗸 (1)

4.2.3 Briefly describe the term recession.

• Recession refers to a decline in economic activities for two consecutive
quarters.🗸🗸
• Recession refers to a period of temporary economic decline during which trade
and industrial activity are reduced, generally identified by a fall in GDP in two
successive quarters 🗸🗸
(Accept any other correct relevant response) (2)

4.2.4 Explain the importance of the trend line.

• Trend line is used to indicate / show the general direction of the
economy.🗸🗸
• A trendline helps technical analysts determine the current direction in
market prices. 🗸🗸
(Accept any other correct relevant response) (2)

4.2.5 Explain the economic activities taking place during depression

• This is a time of general pessimism and consumer spending. 🗸🗸
• Output and economic activity decrease and entrepreneur’s shutdown their
businesses. 🗸🗸
• Employ less people and buy equipment. 🗸🗸
• Profits decrease as well as wages and prices 🗸🗸
• Consumer demand decrease which negatively affect production. 🗸🗸
(Accept any other correct relevant response) (2 x 2) (4)

10
DATA RESPONSE

4.3.1. Identify the form of saving discussed above.

• Stokvel. 🗸 (1)

4.3.2. Name the organisation that teach members of stokvel about financial
literacy according to the above extract.
• National Stokvel Association of South Africa / NASASA. 🗸 (1)

4.3.3. Briefly describe the term prime rate.

• Prime rate refers to the rate at which the commercial banks charge their best
clients. 🗸🗸
• Prime rate refers to the lowest rate of interest at which money may be borrowed
commercially. 🗸🗸
(Accept any other correct relevant response) (2)

4.3.4. How do stokvels contribute towards a better form of saving for members.
• Stokvels are sociable, members have common values and understanding one
another. 🗸🗸
• They impose self-discipline and commitment on people. 🗸🗸
• No one wants to let their friends down when it comes to paying. 🗸🗸
• There is social prestige in belonging to a stokvel. 🗸🗸
• You must be invited to join. 🗸🗸
(Accept any other correct relevant response) (2)

4.3.5. Explain the reasons why people should be encouraged to save.

•To safeguard their money 🗸🗸
•To create wealth 🗸🗸
•For financial sector to make the savings of households, government, and
businesses available as loans to others. 🗸🗸
• Savings can also be channelled back into the economy as investment. 🗸🗸
(Accept any other correct relevant response) (4)

4.4. Differentiate between positive and normative statement.

Positive statement
• A positive statement is an objective fact or announcement. 🗸🗸
• A positive statement is concerned with what was in the past, what is today or what
will be in the future. 🗸🗸
• Positive statements are either right or wrong. 🗸🗸
• For example, Rand appreciated 4% above the dollar. 🗸
Normative statement

• Normative statement involves subjective value judgement. 🗸🗸

• Normative statement can be debated. 🗸🗸
• For example, the grass ought to be green to be beautiful. 🗸
(Accept any other correct relevant response) (8)

11
4.5. How did industrialisation lead to the development of transport and
communication?

Transport
• Railway lines are built to facilitate transportation of bulk products. 🗸🗸
• Roads were improved. 🗸🗸
• Bulk volumes of goods could be transported and delivered in shorter times. 🗸🗸
• Harbours were built for sea transportation. 🗸🗸
• Imports and exports possible. 🗸🗸
• Development of shipping. 🗸🗸

Communication
• Improved communication networks led to improved distribution of information. 🗸🗸
• Business and consumers easily contacted for sales. 🗸🗸
• Exports and imports businesses flourished as a result of easy contacts with
international counterparts 🗸🗸
• Money transfers became easy through internet banking 🗸🗸
• Insurance and investments improved 🗸🗸
(Accept any other correct relevant response) (8)

[40]

12
SECTION C

Answer any ONE of the two questions from this section in the ANSWER BOOK.

Your answer will be assessed as follows:

MARK
STRUCTURE OF ESSAY
ALLOCATION
Introduction:
The introduction is a low-order response.
• A good starting point would be to define or explain a concept or key word
that appears in the question.
Max. 2
• 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
discuss/Analyze/Compare/Evaluate/Distinguish/Differentiate/ Max. 26
Explain/Assess/Draw a graph and explain/Use the graph given and
explain/Complete the graph given/Debate.
A maximum of 8 marks can be awarded for headings/examples.

Additional part: Give own opinion/Critically discuss/Evaluate/

Critically evaluate/Calculate/Deduce/Compare/Explain/Distinguish/
Interpret/Briefly explain/How? /Suggest/Analyze/Evaluate Max. 10
A maximum of 2 marks can be awarded for merely listing of facts.

Conclusion:
Any higher order conclusion must include the following:
• A wrap-up of the discussion of the topic without repetition of facts already
mentioned.
• An own opinion or value judgement of the points discussed with examples
Max. 2
to support your discussion.
• Additional, supporting information that strengthens your
discussion/analysis.
• A contradictory viewpoint with motivation, if requested •
Recommendations
TOTAL 40

13
QUESTION 5: MACROECONOMICS 40 MARKS – 40 MINUTES

• Discuss in detail FOUR main economic participants in the circular flow of an open
economy. (26)

• Evaluate the effect of an economic downswing on the participants in the

economy? (10)
[40]

INTRODUCTION
• A circular flow is a diagram showing the flow of goods, services, factors of production,
income and expenditure, and the relationship between the participants in the economy.
🗸🗸
(Accept any other correct relevant definition)
BODY

MAIN PART
FOUR PARTCIPANTS.

1. HOUSEHOLDS 🗸
• Households are the primary economic participants because they own, directly and
indirectly, the factors of production (land, labour, capital, and entrepreneurship) 🗸🗸
• They offer factors of production to both producers and government. 🗸🗸
• In return they get remuneration in the form of wages and salaries 🗸🗸
• Consumers have needs which are satisfied through the consumption of goods and
services which they purchase from the firms. 🗸🗸
• Consumers demand for goods and services stimulate economic activity by encouraging
firms and the state to produce goods and services. 🗸🗸
• Pay taxes to the government. 🗸🗸

2. BUSINESSES / FIRMS / PRODUCERS 🗸

• They use factors of production to produce goods and services obtainable from
households. 🗸🗸
• Sell goods and services to consumers, government, and foreign sector. 🗸🗸
• Receive income from other participants for payment on goods and services. 🗸🗸
• Firms are motivated to produce goods and services by the profit motive. 🗸🗸
• Pay taxes to the government. 🗸🗸

3. GOVERNMENT. 🗸
• Governments act to provide goods and services, which cannot be provided by firms. 🗸🗸
• The state also has certain functions and roles to play in the economy. 🗸🗸
• Governments receive revenue from firms and households in the form of taxes and
revenue from state-owned property and state-owned enterprises. 🗸🗸
• Renders public services to benefit all the other participants. 🗸🗸

14
 4. FOREIGN SECTOR. 🗸
• The foreign sector supplies goods and services that are imported by households and
businesses and buys goods and services that are exported. 🗸🗸
• The foreign sector pays for the exports and receives money for the imports our country
makes with the rest of the world. 🗸🗸
• The foreign sector also supplies factors of production that are imported and buys factors
of production that are exported.
• They receive remuneration for factors that they import to us and pay for the factors that
we export to them.
(Accept any other correct relevant response)

(Allocate a maximum of 8 marks for mere listing of headings, facts, and examples)
(Allocate a maximum of 26 for discussion of the main part / well explained facts together
with examples and headings)

ADDITIONAL PART
Evaluate the effect of an economic downswing on the participants in the economy?
• Businesses will start producing fewer goods and services. 🗸🗸
• Many households will lose their jobs due to an economic downswing. 🗸🗸
• There will be less consumption of goods and services by households. 🗸🗸
• The government’s revenue from taxes will decline. 🗸🗸
• Government will need to provide more public goods and services. 🗸🗸
• Exports by foreign sector will decline due to the decrease in production. 🗸🗸
(Accept any other correct relevant response)

CONCLUSION
• While circular flow is a simplification of reality, understanding the real flows andmoney
flows that occur in such a situation is an important foundation for understanding more
complex economies. 🗸🗸
(Accept any other correct relevant higher order conclusion) (2)

15
QUESTION 6: ECONOMIC PURSUITS 40 MARKS – 40 MINUTES

Discuss in detail the regulation of markets. (26)

How was surplus production, trade and transportation development used in the
evolution of markets (10)
[40]

INTRODUCTION
• The regulation of markets refers to the rules and regulations that govern economic
activities andtransactions within a market. 🗸🗸
• A market refers to a mechanism which brings both, buyers, and sellers together in order
todetermine the price of the product. 🗸🗸 (2)
(Accept any other correct relevant definition)

BODY

MAIN PART

1. STATE INVOLVEMENT IN TRADE 🗸

• Government intervention was required because changes in political authority supported
the expansion of international trade 🗸🗸
• I.e., powerful states with well-resourced central governments developed through the
unification of cities (2 or more cities combined to form one city / country) and feudal
states. 🗸🗸
• These powerful countries built their military power to take control of other countries and
trade routes around the world . 🗸🗸
• Colonies developed as European governments encouraged journeys of discovery to find
gold and silver in order to increase their wealth, to expand their territories and to
establish new markets to trade their manufactured goods. 🗸🗸
• Mercantilism emerged where countries / governments increased prosperity and power of
the nation through restrictive trade policies. 🗸🗸
• For example, discouraging imports to prevent money flowing out of the country and
encouraging domestic production and exports of goods. 🗸
• Levying of imports tariffs and export subsidies by governments was implemented to
regulate trade. 🗸🗸
• The state exercised control over economic life through corporations and trading
companies. 🗸🗸
• New transportation modes (e.g., Water transport) forced governments to take active part
in the economy because most countries favoured state ownership and operation of
transport networks and public utilities such as waterworks & gasworks. 🗸🗸

16
 2. TAXATION & MOBILIZATION OF FINANCE FOR INVESTMENT IN
INFRASTRUCTURE 🗸

• Financing the economic activities and social living standards became the greatest
challenge faced by the early rulers/governments as a result rulers were forced to raise
new of generating money through taxes such as poll taxes, property taxes and tariffs on
imports and exports. 🗸🗸
• In the Middle East rulers collected tax to finance the cost of building infrastructure like
temples and monuments . 🗸🗸
• The Roman Catholic Church collected tax through tithe which was a compulsorypayment
of 10% of a person's harvest and livestock. 🗸🗸
• England started imposing different taxes on commercial transactions on imports &
exports and luxury goods e.g., meat, chocolate, and alcohol. 🗸🗸
• By the 18th century various countries introduced Progressive income tax which was
charged on the people with higher incomes. 🗸🗸

3. COMPARATIVE ECONOMIC SYSTEM 🗸

• Economics systems are methods used by countries to organise and
distributeresources in a country. 🗸🗸
• The traditional economic system- The oldest system where production is based
ontradition. According to this system tasks and methods of production are
determined/prescribed by habits, customs, and traditions. 🗸🗸
• The command economic system- It is a centrally planned system where the
government determines and plans what will be produced with the available resources
and how goods& services will be distributed. 🗸🗸
• The Market economic system- This system has a minimal government intervention
and afree-market economy where there is private ownership of property, private
freedom, and property rights. It allows free exchange of goods and services. People
can start and ownbusinesses. 🗸🗸
• The mixed economic system- This system has features of both the command and
the market economies meaning private individuals/businesses are free to own
assets andproduce goods and services but the government plan and regulates.🗸🗸
• Examples of countries with mixed economic systems are South Africa, Brazil,
Canada,and Germany. 🗸🗸
•
4. PUBLIC FINANCE AND THE EMERGENCE OF IDEAS ABOUT ECONOMIC POLICY 🗸

• Public finance is about paying (budgeting) for governmental activities, the

design/planning, and the administration of the activities. --Public finance refers to
thestudy of the role of the government in the economy that focusses on
government revenue and government expenditure. 🗸🗸
• Taxation was a major revenue of government finances in order to be able to
achievesocial objective e.g., social services 🗸🗸
• Governments developed markets called capital markets where governments to
borrowmoney, issue bonds and make financial investments. 🗸🗸

17
 •
As economic systems and policies developed, intellectuals/economists criticised
certainpolicies that were put in place i.e., Adam smith criticised mercantilism
because he believed that individual freedom would promote competition. 🗸🗸
• Ideas of economic policies emerged such that various economists came with the
following ideas: economic liberalists, Marxist economics, and Keynesian
economics.🗸🗸
• Economic liberalists- It was believed political freedom and social freedom cannot be
separated from economic freedom. They supported Laissez-faire economics and
argued that government should let individuals to be free and reduce the role of the
government inthe economy. 🗸🗸
• Marxist economics- Karl Max believe in a classless society where all citizens together
owned all economics resources. 🗸🗸

(Allocate a maximum of 8 marks for mere listing of headings, facts, and examples)
(Allocate a maximum of 26 for discussion of the main part / well explained facts
together with examples and headings)

ADDITIONAL PART
• Agriculture become more productive through the invention of crop rotation, food
storage, use oof livestock and breeding.🗸🗸
The increase in productivity, along with refinements in tools, created surplus. 🗸🗸
•
•
These surpluses allowed for non-agricultural activities to develop such as
manufacturing and trade 🗸🗸
• Farmers increased productive, allowing the communities and settlements to
expand.🗸🗸
• The agricultural surpluses and manufactured items brought about the start of real trade
with other communities and even other parts of the world. 🗸🗸
(Accept any other correct relevant response) MAX 10
CONCLUSION
• The effective market regulation requires careful consideration of the specific market
dynamics, the potential risks and benefits, and ongoing monitoring and evaluation to
ensure that regulations remain relevant and effective in a rapidly evolving economic
landscape. 🗸🗸
(Accept any other correct relevant higher order conclusion) (2)

18