Economics term3 cycle test g11

Two ways capital can be created

By investing in physical production of something

By investing in financial assets

how does a progressive tax system affect income distribution

Reduces income inequality by texting a higher income earnings at higher percentage rate and tinge funds through social spending

Name one way to determine the distribution of income

Market mechanism

Briefly describe one reason why wealth can change

A change in the value of the Wealth

Analyse the most important way to create wealth

Consistently 13 income into productive use generating investments and expanding business operations overtime

Why is it said that entrepreneurs are essential in the economy

The entrepreneur combines all factors of production in an effort to increase his wealth

In a more economy entrepreneurs are often entrepreneur agents who employ the other factors of production creating not only well for themselves but also for the people whom they employ

Why did the war in Iran impact our economic growth

He created a global geopolitical uncertainty that distributed trade roots and drove accrued oil prices raising domestic product production and transport cost.

Explain how an increase in technology can lead to an increase in economic growth

The use of better technology can help companies to produce more efficiently and thus make them more competitive. These increase demand could lead to economic growth.

Explain how an increase in investment economic growth

Both private and government investment lead to increased growth but studies indicated investment in the private sector boost growth even more than government investment. The reason for this is that investment project profitability is not always the main consideration for government.

Foreign direct investment can also boost economic role especially in the investment takes place in the manufacturing sector

What do we call the number that is calculated to indicate degree of income inequality

Gini coefficient

Discuss the impact of youth unemployment and economic growth

He changes the income tax based enforce the highest states been on social relief that everything happens from infrastructure investments

Handle skills development and reduces future workforce productivity limiting potential GDP output.

Name the act that requires employees to ensure equitable representation of designated groups across all occupational levels

Employment equity act

Evaluate South Africa’s economic growth performance

2016 to 2019: Stagnant growth averaging around 0.5% to 1.5% heavily hammered by domestic policy uncertainty an initial electricity crisis

2020: Economic rank by roughly 6.4% due to global pandemic lockdowns.

2021: A strong base effect £3 of roughly 4.9% growth led by commodity export prices.

2022 to 2024: Grow slow significantly have a ring between 0.5% and 0.8% as power outages like load shedding peaked.

2025: Groceries bounded slightly to 1.1%, spurred by a recovery in the agricultural sector

2026: Economic growth is expected to average moderately higher between 1.0% and 1.2% as energy supply constraints ease.

Name one method to increase economic development

The available factors of production in the economy must be used more efficiently

How does the industrial development corporation contributes to the promotion of entrepreneurship

By providing direct competitive loans equity investments and business development guidance to industrial entrepreneurs

Name one indicator used by the human development index to measure a standard of living in an economy

Gross national income per capita

Differentiate between nominal interest rates and real interest rates

Nominal interest rate is the stated percentage rate without adjusting for inflation where is interest rate is adjusted for inflation.

Discuss two aspects that will influence the interest received or paid

Risk

The maturity or term of an investment or loan

Explain how an increase in economic growth will impact on economic development

Name the text that South Africa uses

Progressive income income tax

Explain the meaning of monetary term M3

To measure the amount of money available in the economy or the money supply we use certain measures called M1 M2 and M3

M3 is equal to M2 plus all long-term deposits of the domestic private sector with banks

How does nominal GDP differ from real GDP

No no GDP measure economic output calculated at certain market prices while GDP measures output adjusted for inflation using constant base yearprices

Explain how subsidies on properties can be seen as one of the governments distribution methods

Describe how the NDP contributes positively to South Africa

It establishes strategic long-term development benchmarks to indicate absolute poverty and decrease structural inequality by 2030

Guide state spending towards key infrastructure education and industrial capacity initiatives.

How can the subject use monetary policy to manage the money supply and interest rates

The SARB manages the money supply and interest rates to maintain price ability and keep inflation within the target band

When the SARB raises the report rate it will encourage savings because people will not get higher interest on their savings

Name two main sources of income for the government

Corporate tax

PAYE

Differentiate between economic growth and economic development