JUNE EXAMINATION
GRADE 12
2023
ECONOMICS
(PAPER 1)
TIME: 2 hours
MARKS: 200
13 pages
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ECONOMICS 2
(PAPER 1) GR12 0623
INSTRUCTIONS AND INFORMATION
1. Answer FOUR questions as follows in the ANSWER BOOK:
SECTION A: COMPULSORY
SECTION B: Answer TWO of the three questions.
SECTION C: Answer ONE of the two questions.
2. Answer only the required number of questions. Answers in excess of the required
number will NOT be marked.
3. Number the answers correctly according to the numbering system used in this question
paper.
4. Write the question number above each answer.
5. Read the questions carefully.
6. Start the answer to EACH question on a NEW page.
7. Leave 1 – 2 lines open between sub-sections of questions.
8. Answer the questions in full sentences and ensure that the format, content and context
of your responses comply with the cognitive requirements of the questions.
9. Use only black or blue ink.
10. You may use a non-programmable calculator.
11. Write neatly and legibly.
Please turn over
ECONOMICS 3
(PAPER 1) GR12 0623
SECTION A (COMPULSORY)
QUESTION 1 30 MARKS – 20 MINUTES
1.1 Various options are provided as possible answers to the following questions.
Choose the correct answer and write only the letter (A – D) next to the question
numbers (1.1.1 to 1.1.8) in the ANSWER BOOK. e.g. 1.1.9 D.
1.1.1 Which of the following is a real flow in the product market?
A The spending flow on goods and services from households to firms
B The flow of the factors of production from households to firms
C The income flow from firms to household through the factor market
D The flow of goods and services from firms to households
1.1.2 The … is caused by changes in the building and construction industry.
A Kitchin cycle
B Juggler cycle
C Kuznets cycle
D Kondratieff cycle
1.1.3 The South African Reserve Bank uses … as an instrument to maintain
price stability.
A government expenditure
B the interest rate
C the tax rate
D money supply
1.1.4 Reserve assets are recorded in the …
A Financial account.
B Current account.
C Capital transfer account.
D Gold account.
1.1.5 The value of goods and services produced by a country during a
financial year, is known as … income.
A domestic
B money
C national
D government
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ECONOMICS 4
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1.1.6 Which of the following is the responsibility of local government?
A Streetlights
B Education
C Army
D Car licences
1.1.7 An increase in taxes will cause a decrease in …
A tax collection.
B consumption.
C government revenue.
D government expenditure.
1.1.8 Changes in the terms of trade, signal changes in a country’s …
A prices.
B inflation.
C wealth.
D welfare. (8 x 2) (16)
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ECONOMICS 5
(PAPER 1) GR12 0623
1.2 Choose a description from COLUMN B that matches the item in COLUMN A.
Write only the letter (A – I) next to the question numbers (1.2.1 to 1.2.8) in the
ANSWER BOOK, for example 1.2.9 J.
COLUMN A COLUMN B
1.2.1 Keynesian A A short-term debt obligation of the central
approach government
1.2.2 Amplitude B The ratio between a country's export prices and its
import prices
1.2.3 Boom
C A period of rapid economic expansion
1.2.4 Treasury bills
D It measures the severity of the cyclical fluctuations.
1.2.5 Balance of trade
E A school of thought which believes the economy is
1.2.6 Current prices best controlled by market forces
1.2.7 Non-excludability F Actual values of goods and services
1.2.8 Globalisation G Increasing integration of economies around the
world
H The difference in value between a country's
imports and exports of goods
I It is almost impossible to prevent any person from
using the good
(8 x 1) (8)
1.3 Give ONE term for each of the following descriptions. Write only the term next to
the question numbers (1.3.1 to 1.3.6) in the ANSWER BOOK. Abbreviations,
acronyms and examples will NOT be accepted.
1.3.1 A reporting tool prescribed by the United Nations for countries to compile
gross domestic product figures
1.3.2 The type of business cycle where nominal GDP is adjusted for inflation
1.3.3 Payments by the government to suppliers that reduce their costs
1.3.4 The ability of a country to produce a greater quantity of a good or service
with the same quantity of inputs per unit of time
1.3.5 State owned enterprises that provide public goods and services
1.3.6 The flow of income and expenditure between the participants in the
economy (6 x 1) (6)
TOTAL SECTION A: 30
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ECONOMICS 6
(PAPER 1) GR12 0623
SECTION B
Answer any TWO of the three questions from this section in the ANSWER BOOK.
QUESTION 2: MACROECONOMICS 40 MARKS – 30 MINUTES
2.1 Answer the following questions
2.1.1 Name TWO features of the expansionary phase in the business cycle.
(2 x 1) (2)
2.1.2 Why is parliamentary questioning on the main budget important? (1 x 2) (2)
2.2 Study the diagram below and answer the questions that follow.
Factor
market
Government
Firms Households
Financial
Institutions
Product
market
[Adapted source: Google images]
2.2.1 Identify the participant that uses the factors of production to produce
goods and services. (1)
2.2.2 Through which market will goods and payment for goods and services
flow? (1)
2.2.3 Briefly describe the term goods market. (2)
2.2.4 How does the government reduce economic activities in the circular flow
model? (2)
2.2.5 Explain the impact on the circular flow if leakages are greater than
injections. (2 x 2) (4)
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ECONOMICS 7
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2.3 Study the graph below and answer the questions that follow.
RAND/DOLLAR EXCHANGE RATE
D1
D
Quantity $
2.3.1 Name ONE exchange rate system. (1)
2.3.2 Give ONE reason for the shift of the demand curve above. (1)
2.3.3 Briefly describe the term foreign exchange. (2)
2.3.4 Explain the value of the rand against the dollar after the shift in the
demand curve in the graph above. (2)
2.3.5 How can an appreciation of a currency be negative to a country?
(2 x 2) (4)
2.4 Briefly discuss the trendline and extrapolation as features used in the
forecasting of business cycles. (4 x 2) (8)
2.5 How can efficiency of inputs be used in the supply-side policies to improve the
economy? (4 x 2) (8)
[40]
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ECONOMICS 8
(PAPER 1) GR12 0623
QUESTION 3: MACROECONOMICS 40 MARKS – 30 MINUTES
3.1 Answer the following questions.
3.1.1 Name any TWO sub-accounts in the financial account. (2 x 1) (2)
3.1.2 How is national income determined in the four-sector economy? (1 x 2) (2)
3.2 Study the graph below and answer the questions that follow.
PHILLIPS CURVE
Inflation
Phillips Curve
Unemployment (%)
[Source: Internet images]
3.2.1 What is the natural rate of unemployment according to the graph above? (1)
3.2.2 Name ONE supply side measure that can be applied to shift the curve to
the left. (1)
3.2.3 Briefly describe the term natural rate of unemployment. (2)
3.2.4 How would trade unions react if the Phillips curve moves from point
A to B? (2)
3.2.5 How can provision of infrastructural services by government reduce the
cost of doing business? (2 x 2) (4)
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ECONOMICS 9
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3.3 Study the cartoon below and answer the questions that follow.
Come on, put your
back into it!
SOEs
EDUCATION
UNEMPLOYMENT
JOBS
WELFARE
[Source: https://twitter.com/FMFSouthAfrica/status/1498613417711742983]
3.3.1 What is the international benchmark for the percentage of public debt to
GDP ratio? (1)
3.3.2 List ONE example of a community good. (1)
3.3.3 Briefly describe the term full employment. (2)
3.3.4 How can the progressive tax system affect the redistribution of wealth in
South Africa? (2)
3.3.5 Analyse the cartoon and state what impact the situation will have on the
main budget? (2 x 2) (4)
3.4 Discuss export promotion and import controls as measures used to correct the
balance of payments. (4 x 2) (8)
3.5 Why is it important to calculate real GDP? (4 x 2) (8)
[40]
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ECONOMICS 10
(PAPER 1) GR12 0623
QUESTION 4: MACROECONOMICS 40 MARKS – 30 MINUTES
4.1 Answer the following questions.
4.1.1 Name TWO transactions in the capital transfer account. (2 x 1) (2)
4.1.2 Why must the government conserve and preserve resources? (1 x 2) (2)
4.2 Study the graph below and answer the questions that follow.
Expenditure THE MULTIPLIER (Y = C + S)
C+I+G
E
C1 + I + G
E1
600
300
45°
0 400 1 000 Income
[Source: Internet images]
4.2.1 Identify the number of participants represented in the multiplier model
above. (1)
4.2.2 What is the purpose of the 45° line in the graph? (1)
4.2.3 Briefly describe the term marginal propensity to save. (2)
4.2.4 How can a negative multiplier occur in the circular flow model? (2)
4.2.5 Calculate the multiplier from the information provided in the graph
above. Show ALL calculations. (2 x 2) (4)
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ECONOMICS 11
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4.3 Study the information below and answer the questions that follow.
COMPOSITE BUSINESS CYCLE INDICATORS FOR SOUTH AFRICA
Indices:
Mar Apr May Jun Jul Aug Sep Oct Nov
2015 = 100
Leading
127,3 133,3 136,2 130,2 127,0 127,9 125,0 125,2 125,9
indicator
12-month
percentage 21,4 35,2 39,5 26,8 19,0 14,9 9,3 6,0 5,0
change
Source: https://www.resbank.co.za/en/home/publications/composite-business-cycle-
indicators
4.3.1 Name ONE example of leading economic indicators. (1)
4.3.2 Which economic indicator confirms the behaviour of co-incident
indicators? (1)
4.3.3 Briefly describe the term composite indicator. (2)
4.3.4 Explain the effect of government spending during a recession in the
business cycle. (2)
4.3.5 Calculate the first 6 months’ moving average for the leading economic
indicator. Show ALL calculations. (2 x 2) (4)
4.4 Explain the Laffer curve with the aid of a graph. (4 x 2) (8)
4.5 Analyse the conditions during a boom and how monetary policy “cools down” the
economy in the business cycle. (4 x 2) (8)
[40]
TOTAL SECTION B: 80
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ECONOMICS 12
(PAPER 1) GR12 0623
SECTION C
Answer 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 lower-order response.
• A good starting point would be to define the main concept related to
the question topic.
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 mentioning in the introduction what you are going to discuss in
the body.
BODY
Main part: Discuss in detail/In-depth discussion/Examine/Critically Max. 26
discuss/Analyse/Compare/Evaluate/Distinguish/Differentiate/Explain/
Draw a graph and explain/Use the graph given and explain/Complete
the given graph/Assess/Debate
A maximum of 8 marks may be allocated for headings/examples
Additional part: Critically discuss/Evaluate/Critically evaluate/Debate/ Max. 10
Deduce/Compare/Distinguish/Interpret/How?/Suggest
A maximum of 2 marks may be allocated for the mere listing of
facts.
Conclusion
Any higher-order conclusion should include:
• A brief summary of what has been discussed without repeating facts
already mentioned Max. 2
• Any opinion or value-judgement on the facts discussed
• Additional supporting information to strengthen the
discussion/analysis
• A contradictory viewpoint with motivation, if required
• Recommendations
TOTAL 40
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ECONOMICS 13
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QUESTION 5: MACROECONOMICS 40 MARKS – 40 MINUTES
• Discuss, in detail, reasons for public sector failure, and link them to typical
problems experienced through public sector provisioning. (26 marks)
• Evaluate the implementation of a basic income grant in South Africa. (10 marks) (40)
QUESTION 6: MACROECONOMICS 40 MARKS – 40 MINUTES
• Discuss, in detail, the supply reasons for international trade. (26 marks)
• Examine comparative advantage in international trade, by using an appropriate
example. (10 marks) (40)
TOTAL SECTION C: 40
TOTAL: 150
END
