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Questions and Answers

What does economic growth reflect in a nation's development?

  • A stable capacity to produce goods and services
  • An increase in the capacity to produce goods and services (correct)
  • A decrease in the capacity to produce goods and services
  • A shift in the type of goods and services produced
  • What is included in the definition of wealth in economic terms?

  • Only the ability to generate income
  • Only the potential for value appreciation
  • The ability to generate income, potential for value appreciation, and investments that yield returns (correct)
  • Only investments that yield returns
  • What is the primary source of wealth?

  • Savings (correct)
  • Luck
  • Inheritance
  • Profits from business activities
  • What is the Gini Coefficient used to measure?

    <p>Wealth distribution</p> Signup and view all the answers

    What is one reason for the uneven distribution of wealth?

    <p>Inheritance</p> Signup and view all the answers

    What is closely tied to the standard of living?

    <p>Economic growth</p> Signup and view all the answers

    What curve illustrates the actual distribution of wealth across a population?

    <p>Lorenz Curve</p> Signup and view all the answers

    What can impact economic opportunities due to uneven wealth distribution?

    <p>Discrimination and health</p> Signup and view all the answers

    What is the primary goal of the Growth, Employment, and Redistribution Policy (GEAR) in South Africa?

    <p>To promote economic growth and redistribution</p> Signup and view all the answers

    What is the definition of poverty according to the World Bank?

    <p>The inability to attain a minimum standard of living</p> Signup and view all the answers

    What is the purpose of the Reconstruction and Development Programme (RDP) in South Africa?

    <p>To target restructuring the economy for sustainable development</p> Signup and view all the answers

    What are the characteristics of Indigenous Knowledge Systems (IKS)?

    <p>Local and culture-specific, experiential, and dynamic</p> Signup and view all the answers

    What is the main function of money as a medium of exchange?

    <p>To facilitate the buying and selling of goods and services</p> Signup and view all the answers

    What is the purpose of the Millennium Development Goals (MDG)?

    <p>To address issues of poverty, education, and health</p> Signup and view all the answers

    What is the effect of poverty on health?

    <p>It affects health negatively</p> Signup and view all the answers

    What is the purpose of the Accelerated Shared Growth Initiative for South Africa (ASGISA)?

    <p>To rectify shortcomings of previous policies and boost economic growth</p> Signup and view all the answers

    What is the measurement of poverty that indicates the minimum income needed to cover basic needs?

    <p>Poverty line income</p> Signup and view all the answers

    What is the importance of Indigenous Knowledge Systems (IKS) in South Africa?

    <p>It is valuable for addressing local healthcare needs, agricultural practices, and environmental management</p> Signup and view all the answers

    What is a method of wealth redistribution?

    <p>Job creation programs</p> Signup and view all the answers

    What is measured in nominal terms?

    <p>Raw growth data that includes inflation</p> Signup and view all the answers

    What is a factor that influences economic growth?

    <p>Resource Exploitation</p> Signup and view all the answers

    What is a characteristic of developing countries?

    <p>Low standard of living</p> Signup and view all the answers

    What is used to measure a country's development?

    <p>The Human Development Index (HDI)</p> Signup and view all the answers

    What is a strategy for economic development?

    <p>Resource Improvement</p> Signup and view all the answers

    What is the difference between economic growth and economic development?

    <p>Economic growth is an increase in output, while economic development is an improvement in standard of living</p> Signup and view all the answers

    What is a factor that determines standard of living?

    <p>Economic growth</p> Signup and view all the answers

    What is a characteristic of developing countries?

    <p>Low life expectancy</p> Signup and view all the answers

    What is a strategy for economic development?

    <p>Modernization of Agriculture</p> Signup and view all the answers

    What type of money is backed by a physical commodity?

    <p>Commodity money</p> Signup and view all the answers

    What is the primary function of the South African Reserve Bank (SARB)?

    <p>To implement monetary policy to control inflation</p> Signup and view all the answers

    What is the purpose of micro-lending?

    <p>To provide small loans to individuals unable to access traditional bank financing</p> Signup and view all the answers

    What is the result of a bank extending loans exceeding its cash reserves?

    <p>The creation of new money through credit</p> Signup and view all the answers

    What is the consequence of a bank failure on the economy?

    <p>Losses for depositors and investors</p> Signup and view all the answers

    What is the primary factor of production that is essential for production but varies in availability and renewability?

    <p>Natural Resources</p> Signup and view all the answers

    What is the typical payment associated with natural resources?

    <p>Rent</p> Signup and view all the answers

    What is the characteristic of labor that affects its supply?

    <p>It is non-storable</p> Signup and view all the answers

    What is the importance of a stable banking system?

    <p>It supports economic growth</p> Signup and view all the answers

    What is the role of the South African Reserve Bank (SARB) in terms of currency?

    <p>To issue and manage currency</p> Signup and view all the answers

    What is the primary factor that influences labor supply?

    <p>Population growth</p> Signup and view all the answers

    What is the reward for entrepreneurs in an economic system?

    <p>Profit</p> Signup and view all the answers

    What is the term for the continuous movement of goods, services, and money within an economy?

    <p>Circular Flow of Goods and Services</p> Signup and view all the answers

    What is the primary purpose of investing in capital goods?

    <p>To match growth in labor and manage depreciation</p> Signup and view all the answers

    What is the difference between final and intermediate goods?

    <p>Final goods are consumed by the end user, while intermediate goods are used in further production</p> Signup and view all the answers

    What is the role of government in the circular flow of goods and services?

    <p>To collect taxes and redistribute income</p> Signup and view all the answers

    What is the term for the return on invested funds in capital?

    <p>Interest</p> Signup and view all the answers

    What is the component of the circular flow that represents total spending by households on goods and services?

    <p>Consumption (C)</p> Signup and view all the answers

    What is the term for the total economic activity of a country?

    <p>Gross Domestic Product (GDP)</p> Signup and view all the answers

    What is the primary factor that influences wage levels?

    <p>Demand for specific labor types</p> Signup and view all the answers

    What is the major difference between Gross Domestic Product (GDP) and Gross National Income (GNI)?

    <p>GNI includes foreign income while GDP does not</p> Signup and view all the answers

    Which of the following approaches is used to calculate GDP through the income method?

    <p>Total of incomes generated by production (wages, rent, interest, profits)</p> Signup and view all the answers

    What is the primary purpose of understanding the circular flow of an economy?

    <p>To understand how money and goods circulate within an economy, impacting economic policies and decisions</p> Signup and view all the answers

    Which economic system is characterized by a blend of private and public sector involvement in economic processes?

    <p>Mixed Economy</p> Signup and view all the answers

    What is the main advantage of a market economy?

    <p>Efficient production and innovation driven by profit motives</p> Signup and view all the answers

    What is a characteristic of a centrally planned economy?

    <p>State ownership of resources</p> Signup and view all the answers

    What is an advantage of a mixed economy?

    <p>Balances freedom of market operations with government oversight</p> Signup and view all the answers

    What is the main disadvantage of a market economy?

    <p>Potential for significant inequalities in income and wealth distribution</p> Signup and view all the answers

    What is Gross Fixed Capital Formation (I) an indicator of?

    <p>Total investment in physical assets that will be used in future production</p> Signup and view all the answers

    What is the formula for calculating GDP using the expenditure method?

    <p>GDP = C + I + G + (X - Z)</p> Signup and view all the answers

    What is the primary goal of the South African government's economic services?

    <p>To support local businesses and facilitate international trade</p> Signup and view all the answers

    What are the three main sectors of South Africa's economic structure?

    <p>Primary, secondary, and tertiary</p> Signup and view all the answers

    What is the primary contribution of the primary sector to the economy?

    <p>Provision of essential raw materials and energy</p> Signup and view all the answers

    What is the significance of the tertiary sector in South Africa's economy?

    <p>It is the largest contributor to GDP</p> Signup and view all the answers

    What is the purpose of the Land Redistribution Programme in South Africa?

    <p>To address the historical inequalities in land ownership during apartheid</p> Signup and view all the answers

    What is the significance of the secondary sector in South Africa's economy?

    <p>It produces consumer goods and enhances economic self-sufficiency</p> Signup and view all the answers

    What is the purpose of the Black Economic Empowerment (BEE) policy in South Africa?

    <p>To address the historical inequalities in the secondary sector during apartheid</p> Signup and view all the answers

    What is the significance of efficient communication systems in South Africa's economy?

    <p>They are vital for economic competitiveness and information dissemination</p> Signup and view all the answers

    What is the purpose of the New Economic Growth Path in South Africa?

    <p>To promote economic growth through efficient economic services</p> Signup and view all the answers

    What is the significance of South Africa's infrastructure in promoting economic growth?

    <p>It facilitates domestic and international trade, boosting GDP and employment</p> Signup and view all the answers

    What is the primary goal of economic development?

    <p>To improve the standard of living of a society</p> Signup and view all the answers

    What is a common characteristic of developing countries?

    <p>High population growth rate</p> Signup and view all the answers

    What is a factor that influences economic growth?

    <p>All of the above</p> Signup and view all the answers

    What is a strategy for economic development?

    <p>All of the above</p> Signup and view all the answers

    What is used to measure a country's development?

    <p>Human Development Index (HDI)</p> Signup and view all the answers

    What is the difference between economic growth and economic development?

    <p>Economic growth is an increase in output, while economic development is an improvement in standard of living</p> Signup and view all the answers

    What is a factor that determines standard of living?

    <p>All of the above</p> Signup and view all the answers

    What is measured in real terms?

    <p>GDP adjusted for inflation</p> Signup and view all the answers

    What is a method of wealth redistribution?

    <p>All of the above</p> Signup and view all the answers

    What is the primary goal of promoting entrepreneurship?

    <p>To create jobs</p> Signup and view all the answers

    What type of money is representative of digital or paper representations of money?

    <p>Bank money</p> Signup and view all the answers

    What is the main purpose of micro-lending?

    <p>To provide small loans to individuals unable to access traditional bank financing</p> Signup and view all the answers

    What is the role of the South African Reserve Bank (SARB) in terms of monetary policy?

    <p>To implement monetary policy to control inflation</p> Signup and view all the answers

    What is the characteristic of natural resources that affects their distribution across regions?

    <p>Their uneven distribution</p> Signup and view all the answers

    What is the reward for entrepreneurs in an economic system?

    <p>Profit</p> Signup and view all the answers

    What is the result of a bank extending loans exceeding its cash reserves?

    <p>The bank creates new money through credit</p> Signup and view all the answers

    What is the importance of a stable banking system?

    <p>It supports economic growth and confidence</p> Signup and view all the answers

    What is the primary factor of production that is essential for production but varies in availability and renewability?

    <p>Natural Resources</p> Signup and view all the answers

    What is the typical payment associated with natural resources?

    <p>Rent</p> Signup and view all the answers

    What is the characteristic of labor that affects its supply?

    <p>Its non-storability</p> Signup and view all the answers

    What is a key factor that affects the productivity of labor?

    <p>Level of skills and education</p> Signup and view all the answers

    What is the primary reward for entrepreneurs in an economic system?

    <p>Profit</p> Signup and view all the answers

    What is the term for the return on invested funds in capital?

    <p>Interest</p> Signup and view all the answers

    What is the difference between final and intermediate goods?

    <p>Intermediate goods are used as inputs, while final goods are consumed</p> Signup and view all the answers

    What is the term for the continuous movement of goods, services, and money within an economy?

    <p>Circular flow</p> Signup and view all the answers

    What is the primary purpose of investing in capital goods?

    <p>To match growth in labor and manage depreciation</p> Signup and view all the answers

    What is the primary goal of the Reconstruction and Development Programme (RDP) in South Africa?

    <p>To address issues like poverty, education, and health</p> Signup and view all the answers

    Which of the following is a characteristic of Indigenous Knowledge Systems (IKS)?

    <p>Local and culture-specific</p> Signup and view all the answers

    What is the role of government in the circular flow of goods and services?

    <p>To collect taxes and redistribute income</p> Signup and view all the answers

    What is the component of the circular flow that represents total spending by households on goods and services?

    <p>Consumption (C)</p> Signup and view all the answers

    What is the measurement of poverty that indicates the intensity of poverty?

    <p>Poverty gap index</p> Signup and view all the answers

    What is the primary function of money as a store of value?

    <p>To maintain its value over time, allowing savings</p> Signup and view all the answers

    What is the term for the total economic activity of a country?

    <p>Gross Domestic Product (GDP)</p> Signup and view all the answers

    What is the purpose of the Millennium Development Goals (MDG)?

    <p>To address issues like poverty, education, and health</p> Signup and view all the answers

    What is a characteristic of capital that affects productivity and economic output?

    <p>Capital deepening</p> Signup and view all the answers

    What is the primary goal of the Accelerated Shared Growth Initiative for South Africa (ASGISA)?

    <p>To rectify shortcomings of previous policies and boost economic growth</p> Signup and view all the answers

    What is the effect of poverty on health?

    <p>It worsens health outcomes</p> Signup and view all the answers

    What is the purpose of social welfare grants in South Africa?

    <p>To alleviate poverty</p> Signup and view all the answers

    What is the characteristic of money that makes it practical for transactions?

    <p>Durability, divisibility, and manageability</p> Signup and view all the answers

    What is the primary goal of the Growth, Employment, and Redistribution Policy (GEAR) in South Africa?

    <p>To stabilize the economy and promote growth and redistribution</p> Signup and view all the answers

    What is the main role of the tertiary sector in South Africa's economy?

    <p>To provide services and drive economic growth</p> Signup and view all the answers

    What is the purpose of the Land Redistribution Programme in South Africa?

    <p>To address historical inequalities in land ownership</p> Signup and view all the answers

    What is the importance of the primary sector in South Africa's economy?

    <p>It generates employment and foreign exchange</p> Signup and view all the answers

    What is the main goal of South Africa's economic initiatives, such as ASGISA and the New Economic Growth Path?

    <p>To promote economic growth, competitiveness, and employment</p> Signup and view all the answers

    What is the significance of efficient communication systems in South Africa's economy?

    <p>It is vital for economic competitiveness</p> Signup and view all the answers

    What is the importance of the secondary sector in South Africa's economy?

    <p>It produces consumer and capital goods</p> Signup and view all the answers

    What is the main challenge faced by the social services sector in South Africa?

    <p>Inefficiencies in service delivery</p> Signup and view all the answers

    What is the goal of South Africa's international competitiveness initiatives?

    <p>To produce high-quality, competitively priced goods</p> Signup and view all the answers

    What is the significance of transport infrastructure in South Africa's economy?

    <p>It facilitates domestic and international trade, boosting GDP and employment</p> Signup and view all the answers

    What is the importance of the public sector in South Africa's economy?

    <p>It contributes to GDP and is influenced by business cycles</p> Signup and view all the answers

    What does Gross Domestic Product (GDP) measure?

    <p>The total value of all final goods and services produced within a country's borders in a specific time period</p> Signup and view all the answers

    What is the difference between Gross Domestic Product (GDP) and Gross National Income (GNI)?

    <p>GDP does not include income from abroad, while GNI does</p> Signup and view all the answers

    Which of the following is a characteristic of a market economy?

    <p>Predominantly private ownership of production factors</p> Signup and view all the answers

    What is the primary advantage of a mixed economy?

    <p>It balances freedom of market operations with government oversight</p> Signup and view all the answers

    What is the purpose of the circular flow of goods and services?

    <p>To provide insights into how money and goods circulate within an economy</p> Signup and view all the answers

    Which of the following is an advantage of a centrally planned economy?

    <p>Even distribution of income and provision of full employment</p> Signup and view all the answers

    What is the Expenditure Method used to calculate?

    <p>Gross Domestic Product (GDP)</p> Signup and view all the answers

    What is the disadvantage of a market economy?

    <p>Potential for significant inequalities in income and wealth distribution</p> Signup and view all the answers

    What is the importance of understanding the circular flow of goods and services?

    <p>It helps in understanding the effects of various sectors on economic growth and stability</p> Signup and view all the answers

    What is the characteristic of a mixed economy?

    <p>Coexistence of private and public sectors</p> Signup and view all the answers

    What is economic growth closely tied to?

    <p>Standard of living</p> Signup and view all the answers

    What is the ability to generate income an example of?

    <p>Characteristics of wealth</p> Signup and view all the answers

    What is used to measure wealth inequality?

    <p>Gini Coefficient</p> Signup and view all the answers

    What is a reason for uneven wealth distribution?

    <p>All of the above</p> Signup and view all the answers

    What is the primary source of wealth?

    <p>Savings</p> Signup and view all the answers

    What does the Lorenz Curve illustrate?

    <p>Wealth distribution across a population</p> Signup and view all the answers

    What is a characteristic of wealth?

    <p>Both A and B</p> Signup and view all the answers

    What is economic growth a crucial aspect of?

    <p>A nation's development</p> Signup and view all the answers

    What is the ultimate goal of economic development?

    <p>Improved standard of living for all citizens</p> Signup and view all the answers

    Which of the following is a characteristic of developing countries?

    <p>Rapid population growth</p> Signup and view all the answers

    What is a key factor in measuring economic growth?

    <p>Both nominal and real terms</p> Signup and view all the answers

    What is a strategy for economic development?

    <p>Promoting entrepreneurship</p> Signup and view all the answers

    What is the primary benefit of economic growth on a nation's development?

    <p>Increase in the standard of living</p> Signup and view all the answers

    What is a characteristic of wealth in economic terms?

    <p>The ability to generate income and potential for value appreciation or depreciation</p> Signup and view all the answers

    What is a factor that influences standard of living?

    <p>Population size and structure</p> Signup and view all the answers

    What is used to measure a country's development?

    <p>Human Development Index (HDI) only</p> Signup and view all the answers

    What is the purpose of the Lorenz Curve?

    <p>To illustrate the actual distribution of wealth across a population</p> Signup and view all the answers

    Which of the following factors contributes to unequal wealth distribution?

    <p>All of the above</p> Signup and view all the answers

    What is a characteristic of economic growth?

    <p>Increase in a nation's output of goods and services</p> Signup and view all the answers

    What is a method of wealth redistribution?

    <p>Job creation programs</p> Signup and view all the answers

    What is the relationship between economic growth and the standard of living?

    <p>Economic growth is closely tied to the standard of living</p> Signup and view all the answers

    What is measured by the Gini Coefficient?

    <p>Wealth distribution</p> Signup and view all the answers

    What is a factor that influences economic growth?

    <p>Resource exploitation and technological advancements</p> Signup and view all the answers

    What is the primary source of wealth?

    <p>Savings</p> Signup and view all the answers

    What is the primary goal of the Reconstruction and Development Programme (RDP) in South Africa?

    <p>To restructure the economy to enable sustainable development</p> Signup and view all the answers

    What is the difference between economic growth and economic development?

    <p>Economic growth is an increase in output, while economic development is an improvement in standard of living</p> Signup and view all the answers

    What is a result of uneven wealth distribution?

    <p>Structural inequality</p> Signup and view all the answers

    What are the characteristics of Indigenous Knowledge Systems (IKS)?

    <p>Local and culture-specific, experiential, and dynamic</p> Signup and view all the answers

    What is the purpose of the Millennium Development Goals (MDG)?

    <p>To alleviate poverty and hunger globally</p> Signup and view all the answers

    What is the primary function of money as a medium of exchange?

    <p>To facilitate the buying and selling of goods and services</p> Signup and view all the answers

    What is the measurement of poverty that indicates the minimum income needed to cover basic needs?

    <p>Poverty line income</p> Signup and view all the answers

    What is the main characteristic of absolute poverty?

    <p>The lack of basic human needs like water, food, healthcare, education, clothing, and shelter</p> Signup and view all the answers

    What is the primary goal of the Accelerated Shared Growth Initiative for South Africa (ASGISA)?

    <p>To rectify shortcomings of previous policies and boost economic growth</p> Signup and view all the answers

    What are the causes of poverty?

    <p>All of the above</p> Signup and view all the answers

    What is the importance of Indigenous Knowledge Systems (IKS) in South Africa?

    <p>To address local healthcare needs, agricultural practices, and environmental management</p> Signup and view all the answers

    What is the effect of poverty on health?

    <p>It exacerbates health problems</p> Signup and view all the answers

    What is the primary characteristic of commodity money?

    <p>Physical goods used as money</p> Signup and view all the answers

    What is the primary function of the South African Reserve Bank (SARB) in terms of monetary policy?

    <p>Implementation of monetary policy to control inflation</p> Signup and view all the answers

    What is the consequence of a bank extending loans exceeding its cash reserves?

    <p>Credit creation</p> Signup and view all the answers

    What is the primary purpose of micro-lending?

    <p>To provide small loans to individuals unable to access traditional bank financing</p> Signup and view all the answers

    What is the characteristic of natural resources that affects their availability?

    <p>Renewability</p> Signup and view all the answers

    What is the typical payment associated with labor?

    <p>Wage</p> Signup and view all the answers

    What is the importance of a stable banking system?

    <p>It ensures confidence in the banking system and promotes economic growth</p> Signup and view all the answers

    What is the primary factor of production that is essential for production but varies in availability and renewability?

    <p>Natural Resources</p> Signup and view all the answers

    What is the role of the South African Reserve Bank (SARB) in terms of currency?

    <p>To issue and manage currency</p> Signup and view all the answers

    What is the consequence of bank failures on the economy?

    <p>Losses for depositors and investors</p> Signup and view all the answers

    What is the primary factor that influences labor supply?

    <p>All of the above</p> Signup and view all the answers

    What is the reward for entrepreneurs in an economic system?

    <p>Profit</p> Signup and view all the answers

    What is the primary purpose of investing in capital goods?

    <p>To match growth in labor</p> Signup and view all the answers

    What is the term for the continuous movement of goods, services, and money within an economy?

    <p>Circular Flow</p> Signup and view all the answers

    What is the difference between final and intermediate goods?

    <p>Final goods are consumed by the end user, while intermediate goods are used in further production</p> Signup and view all the answers

    What is the role of government in the circular flow of goods and services?

    <p>To collect taxes and redistribute income</p> Signup and view all the answers

    What is the term for the return on invested funds in capital?

    <p>Interest</p> Signup and view all the answers

    What is the component of the circular flow that represents total spending by households on goods and services?

    <p>Consumption (C)</p> Signup and view all the answers

    What is the term for the total economic activity of a country?

    <p>Gross Domestic Product (GDP)</p> Signup and view all the answers

    What is the primary factor that influences wage levels?

    <p>All of the above</p> Signup and view all the answers

    What are the two main roles of the South African government in the mixed economy?

    <p>Providing social services and promoting economic growth through efficient economic services</p> Signup and view all the answers

    What is the main aim of initiatives like ASGISA and the New Economic Growth Path in South Africa?

    <p>To enhance economic growth, competitiveness, and employment</p> Signup and view all the answers

    What are the three main sectors that contribute to South Africa's Gross Domestic Product (GDP)?

    <p>Primary, secondary, and tertiary sectors</p> Signup and view all the answers

    What is the primary importance of the primary sector in South Africa's economy?

    <p>It provides essential raw materials and energy</p> Signup and view all the answers

    What is the main objective of post-apartheid reforms like the Land Redistribution Programme in South Africa?

    <p>To address historical inequalities and exclusions in the primary sector</p> Signup and view all the answers

    What is the primary importance of the tertiary sector in South Africa's economy?

    <p>It is the largest contributor to GDP and drives overall economic growth</p> Signup and view all the answers

    What is the main role of communication systems in South Africa's economy?

    <p>To facilitate domestic and international trade</p> Signup and view all the answers

    What is the primary purpose of South Africa's transport networks?

    <p>To facilitate domestic and international trade, boosting GDP and employment</p> Signup and view all the answers

    What is the primary goal of laws like the Black Economic Empowerment Act and the Employment Equity Act in South Africa?

    <p>To address historical inequalities and exclusions in the economy</p> Signup and view all the answers

    What is the primary importance of the secondary sector in South Africa's economy?

    <p>It produces consumer and capital goods, enhancing economic self-sufficiency and growth</p> Signup and view all the answers

    What is the primary goal of a mixed economy?

    <p>To balance individual freedom with government oversight</p> Signup and view all the answers

    Which of the following is NOT a characteristic of a market economy?

    <p>State ownership of resources</p> Signup and view all the answers

    What is the term for the total value of all final goods and services produced within a country's borders in a specific time period?

    <p>Gross Domestic Product (GDP)</p> Signup and view all the answers

    What is the significance of the circular flow of goods and services?

    <p>It provides insights into how money and goods circulate within an economy</p> Signup and view all the answers

    What is the advantage of a mixed economy in terms of social welfare?

    <p>It aims to improve social welfare</p> Signup and view all the answers

    What is the formula for calculating GDP through the expenditure approach?

    <p>GDP = C + I + G + (X - Z)</p> Signup and view all the answers

    What is a characteristic of a centrally planned economy?

    <p>State ownership of resources</p> Signup and view all the answers

    What is the advantage of a market economy in terms of innovation?

    <p>It promotes innovation driven by profit motives</p> Signup and view all the answers

    What is the primary difference between Gross Domestic Product (GDP) and Gross National Income (GNI)?

    <p>GDP is the total value of goods and services, while GNI is the total income generated</p> Signup and view all the answers

    What is the role of government in a mixed economy?

    <p>To provide essential services and infrastructure</p> Signup and view all the answers

    What is the significance of economic growth in a nation's development?

    <p>It reflects an increase in the capacity to produce goods and services over time.</p> Signup and view all the answers

    What is the primary source of wealth?

    <p>Income not spent on consumption</p> Signup and view all the answers

    What does the Gini Coefficient measure?

    <p>Wealth inequality ranging from 0 to 1</p> Signup and view all the answers

    What is a reason for the uneven distribution of wealth?

    <p>Skills and talent differences</p> Signup and view all the answers

    What is included in the concept of standard of living?

    <p>A wide range of factors, including income, employment, health, and education</p> Signup and view all the answers

    What illustrates the actual distribution of wealth across a population?

    <p>Lorenz Curve</p> Signup and view all the answers

    What is a characteristic of wealth?

    <p>Includes the ability to generate income and potential for value appreciation or depreciation</p> Signup and view all the answers

    What can structural inequality and personal health affect?

    <p>Economic opportunities</p> Signup and view all the answers

    What is the primary goal of economic development?

    <p>To improve the overall standard of living in a country</p> Signup and view all the answers

    What is a key factor that determines the standard of living in a country?

    <p>Population size and structure</p> Signup and view all the answers

    What is a characteristic of developing countries?

    <p>Low standard of living</p> Signup and view all the answers

    What is a strategy for economic development?

    <p>Promoting entrepreneurship</p> Signup and view all the answers

    What is the Human Development Index (HDI) used to measure?

    <p>A country's development through factors like life expectancy, education, and GDP per capita</p> Signup and view all the answers

    What is a factor that influences economic growth?

    <p>All of the above</p> Signup and view all the answers

    What is the difference between economic growth and economic development?

    <p>Economic growth is an increase in output, while economic development is an improvement in standard of living</p> Signup and view all the answers

    What is a method of wealth redistribution?

    <p>All of the above</p> Signup and view all the answers

    What is the purpose of beneficiation processes in resource improvement?

    <p>To increase the value of natural resources</p> Signup and view all the answers

    What is a characteristic of developing countries in terms of infrastructure?

    <p>Inadequate infrastructure</p> Signup and view all the answers

    Which of the following is NOT a method to calculate Gross Domestic Product (GDP)?

    <p>Market Capitalization Method</p> Signup and view all the answers

    What is the main characteristic of a Centrally Planned Economy?

    <p>State ownership of resources</p> Signup and view all the answers

    What is the purpose of a Mixed Economy?

    <p>To combine the advantages of market economy and central planning</p> Signup and view all the answers

    What is Gross Fixed Capital Formation (I)?

    <p>Reflects total investment in physical assets for future production</p> Signup and view all the answers

    What is the importance of understanding the Circular Flow?

    <p>It provides insights into how money and goods circulate within an economy</p> Signup and view all the answers

    What is the main advantage of a Market Economy?

    <p>Efficient production and innovation driven by profit motives</p> Signup and view all the answers

    What is the characteristic of South Africa's Mixed Economy?

    <p>Coexistence of private and public sectors</p> Signup and view all the answers

    What is the main disadvantage of a Centrally Planned Economy?

    <p>Lack of individual and corporate incentive to improve efficiency or innovate</p> Signup and view all the answers

    What is the difference between Gross Domestic Product (GDP) and Gross National Income (GNI)?

    <p>GDP excludes net income from abroad, while GNI includes it</p> Signup and view all the answers

    What is the term for the total economic activity of a country?

    <p>Gross Domestic Product (GDP)</p> Signup and view all the answers

    What type of money is used as a medium of exchange and has value because of government decree?

    <p>Fiat Money</p> Signup and view all the answers

    What is the primary function of the South African Reserve Bank (SARB) in terms of monetary policy?

    <p>Implementing monetary policy</p> Signup and view all the answers

    What is the consequence of a bank failure on the economy?

    <p>Erosion of public trust in the banking system</p> Signup and view all the answers

    What is the characteristic of natural resources that affects their availability?

    <p>Renewability</p> Signup and view all the answers

    What is the typical payment associated with labor?

    <p>Wages</p> Signup and view all the answers

    What is the primary purpose of investing in capital goods?

    <p>To match growth in labor and manage depreciation</p> Signup and view all the answers

    What is the component of the circular flow that represents total spending by households on goods and services?

    <p>Consumption</p> Signup and view all the answers

    What is the primary factor that influences labor supply?

    <p>Time required for training</p> Signup and view all the answers

    What is the term for the return on invested funds in capital?

    <p>Interest</p> Signup and view all the answers

    What is the importance of a stable banking system?

    <p>Promotes confidence and supports economic growth</p> Signup and view all the answers

    What is the primary goal of the Reconstruction and Development Programme (RDP) in South Africa?

    <p>To enable sustainable development and restructure the economy</p> Signup and view all the answers

    What is the major difference between Gross Domestic Product (GDP) and Gross National Income (GNI)?

    <p>GDP only includes domestic production, while GNI includes foreign production</p> Signup and view all the answers

    What is the role of the South African Reserve Bank (SARB) in terms of currency?

    <p>Issuing and managing currency</p> Signup and view all the answers

    Which of the following is a characteristic of Indigenous Knowledge Systems (IKS)?

    <p>It is rooted in specific communities and traditions</p> Signup and view all the answers

    What is the primary function of micro-lending?

    <p>Providing small loans to individuals</p> Signup and view all the answers

    What is the characteristic of labor that affects its supply?

    <p>Labor force participation rates</p> Signup and view all the answers

    What is the poverty gap index used to measure?

    <p>The average shortfall from the poverty line</p> Signup and view all the answers

    What is one of the effects of poverty on a society?

    <p>Social unrest and higher crime rates</p> Signup and view all the answers

    What is the result of a bank extending loans exceeding its cash reserves?

    <p>Increasing the money supply</p> Signup and view all the answers

    What is the importance of capital in economic growth?

    <p>It is essential for maintaining and expanding production</p> Signup and view all the answers

    What is the primary function of money as a store of value?

    <p>To maintain its value over time, allowing savings</p> Signup and view all the answers

    What is the role of government in the circular flow of goods and services?

    <p>To collect taxes and redistribute income</p> Signup and view all the answers

    What is the purpose of the Millennium Development Goals (MDG)?

    <p>To address issues like poverty, education, and health globally</p> Signup and view all the answers

    What is the primary factor that influences wage levels?

    <p>The demand for specific labor types</p> Signup and view all the answers

    What is the primary goal of the Accelerated Shared Growth Initiative for South Africa (ASGISA)?

    <p>To rectify shortcomings of previous policies and boost economic growth</p> Signup and view all the answers

    What is the term for the continuous movement of goods, services, and money within an economy?

    <p>Circular Flow of Goods and Services</p> Signup and view all the answers

    What is the term used to describe the lack of basic human needs like water, food, healthcare, education, clothing, and shelter?

    <p>Absolute poverty</p> Signup and view all the answers

    What is the difference between final and intermediate goods?

    <p>Final goods are consumed by the end user, while intermediate goods are used as inputs</p> Signup and view all the answers

    What are the main goals of the South African government's economic services?

    <p>To provide social welfare and promote economic growth</p> Signup and view all the answers

    What is the primary goal of social welfare grants in South Africa?

    <p>To alleviate poverty</p> Signup and view all the answers

    What is the primary sector's importance in the South African economy?

    <p>It provides raw materials and energy for manufacturing</p> Signup and view all the answers

    What is the characteristic of money that makes it practical for use?

    <p>Durability, divisibility, and manageability</p> Signup and view all the answers

    What is the main challenge in the South African healthcare system?

    <p>Inefficient service delivery and strains on the system</p> Signup and view all the answers

    What is the purpose of the Land Redistribution Programme in South Africa?

    <p>To address historical inequalities in land ownership</p> Signup and view all the answers

    What is the significance of the tertiary sector in South Africa's economy?

    <p>It is the primary contributor to GDP</p> Signup and view all the answers

    What is the purpose of the Black Economic Empowerment (BEE) programme?

    <p>To improve access and equity in the secondary sector</p> Signup and view all the answers

    What is the importance of efficient communication systems in South Africa?

    <p>It is vital for economic competitiveness and facilitates domestic and international trade</p> Signup and view all the answers

    What is the role of the South African government in promoting economic growth?

    <p>To promote economic growth through efficient economic services</p> Signup and view all the answers

    What is the significance of infrastructure in South Africa's economy?

    <p>It facilitates domestic and international trade, boosting GDP and employment</p> Signup and view all the answers

    What is the aim of initiatives like ASGISA and the New Economic Growth Path?

    <p>To enhance growth, competitiveness, and employment</p> Signup and view all the answers

    What is the primary outcome of economic growth on the standard of living?

    <p>Increased health and education</p> Signup and view all the answers

    Which of the following is NOT a characteristic of wealth in economic terms?

    <p>Total amount of material possessions</p> Signup and view all the answers

    What is the primary purpose of the Lorenz Curve?

    <p>To show deviations from perfect equality in wealth distribution</p> Signup and view all the answers

    Which of the following is a reason for uneven distribution of wealth?

    <p>All of the above</p> Signup and view all the answers

    What is the relationship between economic growth and the ability to produce goods and services?

    <p>Economic growth reflects an increase in the capacity to produce goods and services</p> Signup and view all the answers

    What is the impact of inheritance on wealth distribution?

    <p>It provides certain individuals with a financial head start</p> Signup and view all the answers

    What is the name of the coefficient that measures wealth inequality?

    <p>Gini Coefficient</p> Signup and view all the answers

    Which of the following is NOT a source of wealth?

    <p>Government subsidies</p> Signup and view all the answers

    What is the primary difference between economic growth and economic development?

    <p>Economic growth is concerned with the overall output of a country, while economic development is concerned with the standard of living of a society</p> Signup and view all the answers

    What is the primary purpose of the Human Development Index (HDI)?

    <p>To measure a country's development through factors like life expectancy, education, and GDP per capita</p> Signup and view all the answers

    What is the primary benefit of promoting entrepreneurship in developing countries?

    <p>It creates jobs and diversifies goods and services</p> Signup and view all the answers

    What is the primary characteristic of developing countries that hinders economic development?

    <p>Low productivity due to outdated technology and insufficient capital</p> Signup and view all the answers

    What is the primary goal of modernization of agriculture in developing countries?

    <p>To increase agricultural output and improve productivity</p> Signup and view all the answers

    What is the primary factor that determines the standard of living in a country?

    <p>All of the above</p> Signup and view all the answers

    What is the primary benefit of increasing labor quality in developing countries?

    <p>It improves healthcare and worker motivation</p> Signup and view all the answers

    What is the primary purpose of beneficiation in natural resource management?

    <p>To add value to natural resources through processing and manufacturing</p> Signup and view all the answers

    What is the primary impact of inadequate infrastructure on economic development?

    <p>It hinders economic growth and development</p> Signup and view all the answers

    What is the primary purpose of capital investment in developing countries?

    <p>To stimulate economic growth and development</p> Signup and view all the answers

    Which type of money is characterized by digital or paper representations of money?

    <p>Bank Money</p> Signup and view all the answers

    What is the primary purpose of micro-lending in South Africa?

    <p>To provide small loans to individuals unable to access traditional bank financing</p> Signup and view all the answers

    Which of the following is NOT a role of the South African Reserve Bank (SARB)?

    <p>Setting interest rates for commercial lending</p> Signup and view all the answers

    What is the term for funds deposited for a fixed term with varying notice periods for withdrawal?

    <p>Time Deposits</p> Signup and view all the answers

    What is the primary characteristic of natural resources that affects economic dynamics?

    <p>Their uneven distribution across regions</p> Signup and view all the answers

    What is the typical payment associated with labor in a market system?

    <p>Wages</p> Signup and view all the answers

    What is the primary consequence of a bank failure on the economy?

    <p>Potential systemic risk affecting the broader economy</p> Signup and view all the answers

    What is the primary function of the South African Reserve Bank (SARB) in terms of currency?

    <p>Issuing and managing currency</p> Signup and view all the answers

    What is the primary factor of production that is essential for production but varies in availability and renewability?

    <p>Natural Resources</p> Signup and view all the answers

    What is the importance of a stable banking system?

    <p>It supports economic growth and confidence</p> Signup and view all the answers

    What is the primary goal of the Accelerated Shared Growth Initiative for South Africa (ASGISA)?

    <p>To rectify shortcomings of previous policies and boost economic growth</p> Signup and view all the answers

    What is the characteristic of money that makes it a store of value?

    <p>Stability</p> Signup and view all the answers

    What is the primary focus of the Reconstruction and Development Programme (RDP) in South Africa?

    <p>To restructure the economy to enable sustainable development</p> Signup and view all the answers

    What is the characteristic of Indigenous Knowledge Systems (IKS) that makes it dynamic?

    <p>Continuously evolving as new insights are gained and old ones are re-evaluated</p> Signup and view all the answers

    What is the purpose of the headcount index in measuring poverty?

    <p>To measure the percentage of the population living below the poverty line</p> Signup and view all the answers

    What is the primary goal of the Growth, Employment, and Redistribution Policy (GEAR) in South Africa?

    <p>To stabilize the economy and promote growth and redistribution</p> Signup and view all the answers

    What is the characteristic of poverty that affects health?

    <p>Perpetual cycle of poverty</p> Signup and view all the answers

    What is the importance of Indigenous Knowledge Systems (IKS) in South Africa?

    <p>All of the above</p> Signup and view all the answers

    What is the primary goal of the Millennium Development Goals (MDG)?

    <p>To eradicate extreme poverty and hunger</p> Signup and view all the answers

    What is the measurement of poverty that reflects the intensity of poverty?

    <p>Poverty gap index</p> Signup and view all the answers

    What is the primary reason why investment in capital goods is necessary?

    <p>To match growth in labor</p> Signup and view all the answers

    Which of the following is a characteristic of capital?

    <p>It includes all manufactured resources used in further production</p> Signup and view all the answers

    What is the primary advantage of a market economy over a centrally planned economy?

    <p>Efficient production and innovation driven by profit motives</p> Signup and view all the answers

    What is the primary role of entrepreneurs in an economic system?

    <p>To innovate and drive economic renewal</p> Signup and view all the answers

    Which of the following is a characteristic of a mixed economy?

    <p>Coexistence of private and public sectors</p> Signup and view all the answers

    What is the main purpose of the Expenditure Method in calculating GDP?

    <p>To calculate the sum of all expenditures made on final goods and services</p> Signup and view all the answers

    What is the term for the total economic activity of a country?

    <p>Gross Domestic Product (GDP)</p> Signup and view all the answers

    What is the primary disadvantage of a centrally planned economy?

    <p>Lack of individual and corporate incentive to improve efficiency</p> Signup and view all the answers

    What is the primary difference between final and intermediate goods?

    <p>Final goods are consumed by the end user, while intermediate goods are used as inputs in the production of other goods</p> Signup and view all the answers

    Which of the following is a key indicator of economic health in the circular flow?

    <p>Gross Domestic Product (GDP)</p> Signup and view all the answers

    What is the term for the return on invested funds in capital?

    <p>Interest</p> Signup and view all the answers

    What is the primary factor that influences labor supply?

    <p>All of the above</p> Signup and view all the answers

    What is the primary goal of government intervention in a mixed economy?

    <p>To balance freedom of market operations with government oversight</p> Signup and view all the answers

    What is the component of the circular flow that represents total spending by households on goods and services?

    <p>Consumption (C)</p> Signup and view all the answers

    What is the primary advantage of a mixed economy over a market economy?

    <p>Balances freedom of market operations with government oversight</p> Signup and view all the answers

    What is the primary function of Gross Fixed Capital Formation (I) in the economy?

    <p>To reflect total investment in physical assets for future production</p> Signup and view all the answers

    What is the primary reason why capital is essential for economic growth?

    <p>It sustains production capabilities</p> Signup and view all the answers

    What is the primary difference between Gross Domestic Product (GDP) and Gross National Income (GNI)?

    <p>GDP excludes income from abroad, while GNI includes it</p> Signup and view all the answers

    What is the primary factor that influences wage levels?

    <p>Both A and B</p> Signup and view all the answers

    What is the primary advantage of the circular flow of goods and services?

    <p>All of the above</p> Signup and view all the answers

    What is the primary role of the South African government in the mixed economy?

    <p>To provide social services to improve public welfare and promote economic growth through efficient economic services</p> Signup and view all the answers

    What is the primary contribution of the tertiary sector to the economy?

    <p>Dominating the economy's GDP and driving overall economic growth</p> Signup and view all the answers

    What was the primary goal of the apartheid policies in the primary sector?

    <p>To deprive black South Africans of land ownership and equal opportunities in farming and mining</p> Signup and view all the answers

    What is the primary importance of the primary sector in the economy?

    <p>It provides essential raw materials and energy, and is crucial for food production and basic materials</p> Signup and view all the answers

    What is the primary purpose of the Land Redistribution Programme in South Africa?

    <p>To address the historical inequalities and exclusions in the primary sector</p> Signup and view all the answers

    What is the primary importance of the secondary sector in the economy?

    <p>It produces consumer and capital goods and enhances economic self-sufficiency</p> Signup and view all the answers

    What is the primary role of the communication sector in the economy?

    <p>To facilitate economic competitiveness and information dissemination</p> Signup and view all the answers

    What is the primary importance of the transport sector in the economy?

    <p>To facilitate domestic and international trade, boosting GDP and employment</p> Signup and view all the answers

    What is the primary goal of initiatives like ASGISA and the New Economic Growth Path in South Africa?

    <p>To enhance growth, competitiveness, and employment in the economy</p> Signup and view all the answers

    What is the primary goal of South Africa in terms of international competitiveness?

    <p>To produce high-quality, competitively priced goods, maintain stable exchange rates, and align inflation with major trading partners</p> Signup and view all the answers

    What is the primary goal of the Reconstruction and Development Programme (RDP) in South Africa?

    <p>To restructure the economy to enable sustainable development</p> Signup and view all the answers

    Which of the following characteristics of money is most important in facilitating economic transactions?

    <p>General Acceptance</p> Signup and view all the answers

    What is the primary reason for the lack of access to resources in South Africa, contributing to poverty?

    <p>All of the above</p> Signup and view all the answers

    What is the primary objective of the Accelerated Shared Growth Initiative for South Africa (ASGISA)?

    <p>To rectify the shortcomings of previous policies and boost economic growth</p> Signup and view all the answers

    What is the primary function of the headcount index in measuring poverty?

    <p>To indicate the percentage of the population living below the poverty line</p> Signup and view all the answers

    What is the primary importance of Indigenous Knowledge Systems (IKS) in South Africa?

    <p>All of the above</p> Signup and view all the answers

    What is the primary purpose of the Millennium Development Goals (MDG)?

    <p>To reduce poverty and hunger globally</p> Signup and view all the answers

    What is the primary effect of poverty on the economy?

    <p>Perpetual cycle of poverty</p> Signup and view all the answers

    What is the primary characteristic of Relative Poverty?

    <p>Comparative lack within society</p> Signup and view all the answers

    What is the primary difference between economic growth and economic development?

    <p>Economic growth is an increase in a nation's output, while economic development is a broad-based improvement in the standard of living.</p> Signup and view all the answers

    What is the primary role of the South African Reserve Bank (SARB) in the economy?

    <p>To manage the country's currency</p> Signup and view all the answers

    Which of the following is a factor that influences economic growth?

    <p>Labor productivity</p> Signup and view all the answers

    What is the purpose of the Human Development Index (HDI)?

    <p>To measure a country's development</p> Signup and view all the answers

    Which of the following is a characteristic of developing countries?

    <p>Low standard of living</p> Signup and view all the answers

    What is the primary purpose of capital investment in economic development?

    <p>To invest in directly productive assets and indirectly productive infrastructure</p> Signup and view all the answers

    What is the primary determinant of standard of living?

    <p>Economic growth</p> Signup and view all the answers

    Which of the following is a strategy for economic development?

    <p>Promoting entrepreneurship</p> Signup and view all the answers

    What is the primary difference between nominal and real terms in measuring economic growth?

    <p>Nominal terms include inflation, while real terms exclude inflation</p> Signup and view all the answers

    What is the primary purpose of social grants in wealth redistribution?

    <p>To balance wealth distribution</p> Signup and view all the answers

    Which of the following is a factor that determines standard of living?

    <p>Employment levels</p> Signup and view all the answers

    What is the primary driver of economic growth in a nation?

    <p>Increase in the capacity of an economy to produce goods and services</p> Signup and view all the answers

    What is the primary characteristic of wealth that distinguishes it from income?

    <p>Potential for value appreciation</p> Signup and view all the answers

    What is the primary purpose of measuring wealth distribution?

    <p>To illustrate the deviation from perfect equality</p> Signup and view all the answers

    What is the primary factor that contributes to the uneven distribution of wealth?

    <p>All of the above</p> Signup and view all the answers

    What is the primary benefit of economic growth on a nation's standard of living?

    <p>Increase in employment opportunities</p> Signup and view all the answers

    What is the primary limitation of the Lorenz Curve in measuring wealth distribution?

    <p>It is limited to measuring wealth distribution within a nation</p> Signup and view all the answers

    What is the primary difference between wealth and income?

    <p>Wealth is a stock concept, while income is a flow concept</p> Signup and view all the answers

    What is the primary consequence of uneven wealth distribution on a nation's economy?

    <p>Increase in social unrest</p> Signup and view all the answers

    What type of money is created when banks extend loans exceeding their cash reserves?

    <p>Bank money</p> Signup and view all the answers

    What is the primary function of the South African Reserve Bank (SARB) in terms of monetary policy?

    <p>Implementing monetary policy</p> Signup and view all the answers

    What is the characteristic of natural resources that affects their availability and renewability?

    <p>Geographic location</p> Signup and view all the answers

    What is the primary goal of micro-lending?

    <p>Providing small loans to individuals</p> Signup and view all the answers

    What is the consequence of a bank failure on the economy?

    <p>Erosion of public trust in the banking system</p> Signup and view all the answers

    What is the characteristic of labor that affects its supply?

    <p>Time required for training</p> Signup and view all the answers

    What is the primary importance of a stable banking system?

    <p>Maintaining financial stability and confidence</p> Signup and view all the answers

    What is the typical payment associated with natural resources?

    <p>Rent</p> Signup and view all the answers

    What is the primary role of the South African Reserve Bank (SARB) in terms of currency?

    <p>Issuing currency</p> Signup and view all the answers

    What is the primary factor of production that is essential for production but varies in availability and renewability?

    <p>Natural Resources</p> Signup and view all the answers

    What is the primary goal of the South African government's role in providing social services?

    <p>to improve public welfare and provide social services</p> Signup and view all the answers

    Which sector is the largest contributor to the GDP in developed economies?

    <p>Tertiary Sector</p> Signup and view all the answers

    What is the purpose of the Land Redistribution Programme in South Africa?

    <p>to address historical exclusion of black South Africans from land ownership</p> Signup and view all the answers

    What is the importance of the primary sector in South Africa?

    <p>it provides essential raw materials and energy</p> Signup and view all the answers

    What is the purpose of the Black Economic Empowerment (BEE) policies in South Africa?

    <p>to address historical exclusion of black individuals in the secondary sector</p> Signup and view all the answers

    What is the importance of the tertiary sector in South Africa?

    <p>it drives overall economic growth and development</p> Signup and view all the answers

    What is the purpose of the Accelerated Shared Growth Initiative for South Africa (ASGISA)?

    <p>to enhance growth, competitiveness, and employment</p> Signup and view all the answers

    What is the role of the transport sector in South Africa's economy?

    <p>to facilitate domestic and international trade</p> Signup and view all the answers

    What is the importance of the communication sector in South Africa's economy?

    <p>it is vital for economic competitiveness</p> Signup and view all the answers

    What is the role of the government in South Africa's mixed economy?

    <p>to provide social services and promote economic growth</p> Signup and view all the answers

    What is the primary factor that affects the level of skills and education in a workforce?

    <p>Demand for specific labor types</p> Signup and view all the answers

    What is the main reason why capital is essential for economic growth?

    <p>It sustains production capabilities</p> Signup and view all the answers

    What is the primary reward for entrepreneurship in an economic system?

    <p>Profit</p> Signup and view all the answers

    What is the term for the continuous movement of goods, services, and money within an economy?

    <p>Circular Flow of Goods and Services</p> Signup and view all the answers

    What is the primary purpose of investing in capital goods?

    <p>To match growth in labor and to manage depreciation</p> Signup and view all the answers

    What is the difference between final and intermediate goods?

    <p>Final goods are consumed by the end user, while intermediate goods are used as inputs in the production of other goods</p> Signup and view all the answers

    What is the role of government in the circular flow of goods and services?

    <p>To collect taxes and redistribute income through spending and transfers</p> Signup and view all the answers

    What is the term for the return on invested funds in capital?

    <p>Interest</p> Signup and view all the answers

    What is the component of the circular flow that represents total spending by households on goods and services?

    <p>Consumption</p> Signup and view all the answers

    What is the primary factor that influences wage levels?

    <p>Demand for specific labor types</p> Signup and view all the answers

    What is the primary advantage of a mixed economy?

    <p>Promotion of economic growth and social welfare</p> Signup and view all the answers

    What is the major difference between Gross Domestic Product (GDP) and Gross National Income (GNI)?

    <p>GDP excludes income from abroad, while GNI includes it</p> Signup and view all the answers

    What is the primary characteristic of a centrally planned economy?

    <p>State ownership of resources</p> Signup and view all the answers

    What is the primary advantage of a market economy?

    <p>Efficient production and innovation driven by profit motives</p> Signup and view all the answers

    What is the primary component of the circular flow of goods and services that represents total spending by households on goods and services?

    <p>Consumption (C)</p> Signup and view all the answers

    What is the primary purpose of the Expenditure Method in calculating GDP?

    <p>To calculate the total expenditure made on final goods and services</p> Signup and view all the answers

    What is the primary characteristic of the mixed economy in South Africa?

    <p>Coexistence of private and public sectors</p> Signup and view all the answers

    What is the primary advantage of understanding the circular flow of goods and services?

    <p>It provides insights into the effects of various sectors on economic growth and stability</p> Signup and view all the answers

    What is the primary purpose of Gross Fixed Capital Formation (I)?

    <p>To reflect total investment in physical assets</p> Signup and view all the answers

    What is the primary disadvantage of a market economy?

    <p>Potential for significant inequalities in income and wealth distribution</p> Signup and view all the answers

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