ECONOMICS
PAPER ONE (P1)
GRADE 12
NSC PAST PAPERS AND MEMOS
SEPTEMBER 2016

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. Number the answers correctly according to the numbering system used  in this question paper.
3. Write the number of the question above each answer. 
4. Read the questions carefully and start each question on a NEW page.
5. Leave 2–3 lines between subsections of questions.
6. 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.
7. Answer only the required number of questions. Answers in excess of  the required number will NOT be marked.
8. Use only black or blue ink. 
9.  A non-programmable pocket calculator may be used.
10. Write neatly and legibly.

QUESTIONS

SECTION A (COMPULSORY) 
QUESTION 1 30 MARKS – 20 MINUTES 
1.1 Various options are provided as possible answers to the following  questions. Choose the answer and write only the letter (A–C) next to the  question number (1.1.1–1.1.8) in the ANSWER BOOK, for example  1.1.9 D. 

1.1.1 Taxes that relate to individual goods, are called taxes on ... 

1. 1. production. 
   2. products. 
   3. income. 

1.1.2 Trends are measured through ... in the economy. 

1. 1. extrapolation 
   2. moving averages 
   3. economic indicators 

1.1.3 Putting laws in place to regulate activities is known as ... 

1. 1. deregulation.
   2. regulation. 
   3. nationalisation. 

1.1.4 A transaction relating to investment in businesses is called ...  investment. 

1. 1. portfolio 
   2. other 
   3. direct  

1.1.5 Regional cooperation and integration among African states is  provided by ... 

1. 1. Nepad. 
   2. SADC.
   3. WTO. 

1.1.6 Cash incentives to assist foreign investors who want to invest in  new manufacturing businesses in South Africa is offered by the ... 

1. 1. Foreign Investment Incentive.
   2. Small and Medium Enterprise Development Programme.
   3. Black Business Supplier Development.

1.1.7 The initiative to enhance economic growth and create employment is known as ... 

1. 1. The New Growth Path.
   2. Black Economic Empowerment. 
   3. The Development Bank of South Africa. 

1.1.8 According to the UN classification, South Africa falls in the …  human development group of countries.  

1. 1. lower
   2. middle
   3. higher (8 x 2)

(16) 

1.2 Choose a description from COLUMN B that matches an item in  COLUMN A. Write only the letter (A–I) next to the question number  (1.2.1–1.2.8) in the ANSWER BOOK.  

1.3 Give ONE term for each of the following descriptions. Write only the term  next to the question number (1.3.1–1.3.6) in the ANSWER BOOK. 

1.3.1 The effect of spending on national income 
1.3.2 Cycles that last for the period of 3–5 years caused by adapting  inventory levels in businesses 
1.3.3 A record of export and import merchandise 
1.3.4 A penalty applied by one or more countries on another country 1.3.5 Policies aimed at increasing the aggregate supply 
1.3.6 Indicators concerned with inflation rates and the supply of money  (6 x 1) (6) 

TOTAL SECTION A: 30

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 types of financial markets. (2 x 1) (2) 
2.1.2 How can the government use the fiscal policy if the economy is  expanding too slowly? (1 x 2) (2) 
2.2 Study the graph below and answer the questions that follow.

2.2.1 Which dotted line on the graph represents the length? (1)
2.2.2 When did the economy reach its highest peak? (1)
2.2.3 Briefly explain what the amplitude demonstrates. (2 x 2) (4) 
2.2.4 How will a large amplitude during an upswing affect workers in  general? (2 x 2) (4)

2.3 Study the picture below and answer the questions that follow. 

The tolls collected on a specific road are used to, inter alia; repay the  loans obtained to finance the building, upgrading or improvement of the  road. In addition, it provided a dedicated ongoing revenue stream,  which enables the road to be adequately maintained and improved,  independent of tax-based revenue.  [Source: Adapted from www.sanral.co.za/e toll]

2.3.1 What are tolls used for? (2 x 1) (2) 
2.3.2 Discuss briefly collective goods as one of the pricing options.  (2 x 2) (4) 
2.3.3 How successful is the public sector in delivering public goods in  South Africa? (4) 

2.4 Explain the interaction between households and firms in a circular flow.  (4 x 2) (8) 
2.5 How successful is the supply side policy in South Africa to stimulate  economic activity in the smoothing of business cycle? (4 x 2) (8) [40]

QUESTION 3: ECONOMIC PURSUITS 40 MARKS – 30 MINUTES
3.1 Answer the following questions. 

3.1.1 Name TWO of South Africa’s industrial development strategies.  (2 x 1) (2) 
3.1.2 Which specifications will be considered when the GDP is calculated  in assessing the performance of the South African economy? (1 x 2) (2) 

3.2 Study the information below and answer the questions that follow. 

 3.2.1 What is the main objective of Expanded Public Works Programme  (EPWP)? (2) 
3.2.2 Identify any TWO sectors by which the EPWP create jobs. (2 x 2) (4) 
3.2.3 How successful has the Expanded Public Works Programme been  in achieving growth and development in South Africa? (4)

3.3 Study the table below and answer the questions that follow. 
Births and deaths in SA for period 2013–2015 

                             [Source: Stats SA, July 2015] 

3.3.1 Name the social indicator used in the above table. (1) 
3.3.2 What is the trend of the percentage Aids deaths from 2013 to  2015? (1) 
3.3.3 Define the term life expectancy. (2) 
3.3.4 Why is the above information important for the South African  government? (2) 
3.3.5 What positive role can the government play to increase health  care in South Africa? (4) 
3.4 Explain the negative environmental effects caused by activities in the  North. . (4 x 2) (8) 

3.5 What can the government/businesses sector do to increase the current  low economic growth rate substantially? (4 x 2) (8)

[40]

QUESTION 4: MACROECONOMICS AND ECONOMIC PURSUITS   40 MARKS – 30 MINUTES 
4.1 Answer the following questions. 

4.1.1 Name TWO factors that will influence the demand for foreign  exchange. (2 x 1) (2)
4.1.2 Why is GDP at market prices more than the GNI at market prices?   (1 x 2) (2) 

4.2 Study the extract below and answer the questions that follow.

4.2.1 What is the main benefit of regional integration for the people of  Southern Africa? (1) 
4.2.2 What role has the establishment of the Maputo Development  Corridor played in the SADC? (1) 
4.2.3 Discuss the main objectives of the National Development Plan. (4) 
4.2.4 How successful has South Africa been with regional development  compared to international best practices on good governance? (4)

4.3 Study the extract below and answer the questions that follow. 

4.3.1 Mention any ONE zone that has been identified in the extract. (1) 
4.3.2 What is the purpose of the DTI in establishing the SEZ  programme? (1)
4.3.3 Explain the key difference between the IDZ and SEZ. (2 x 2) (4) 
4.3.4 Why is Foreign Direct Investment (FDI) regarded as the most  desired kind of investment in South Africa? (2 x 2) (4) 

4.4 Explain methods used to support export promotion. (4 x 2) (8) 
4.5 Why is education so important as a key social indicator in South Africa?  (4 x 2) (8)

[40] 
TOTAL SECTION B: 80

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

QUESTION 5: MACROECONOMICS 40 MARKS – 40 MINUTES 
Foreign trade is becoming increasingly important for the economic well-being of a  country. The more open and integrated a country is with the rest of the world the  better its chances of improving the economic welfare of its citizens. 

• Discuss the main supply reasons of international trade. (26 marks)
• How effective is international trade for South Africa? (10 marks) [40] 

QUESTION 6: ECONOMIC PURSUITS 40 MARKS – 40 MINUTES 
The purpose of fiscal policy is to stimulate economic growth and employment and to  ensure redistribution of income. 

• Discuss this statement by focusing on the instruments of fiscal policy in the  South African context and how it ensures the desirable redistribution of income.   (26 marks)
• In your opinion, how successful is the South African government in providing  the basic needs for disadvantaged people? (10 marks)

[40] 
TOTAL SECTION C: 40 
GRAND TOTAL: 150