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PMAC6122T2a

The document outlines the assessment details for the Economics 1B module, including instructions for a test worth 60 marks with a duration of one hour plus 10 minutes of reading time. It contains multiple-choice questions, true/false statements, and problem-solving questions related to economic concepts. Students are required to adhere to specific guidelines regarding independent work, use of calculators, and submission of their answer sheets.

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thandodlamini5556
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1 views4 pages

PMAC6122T2a

The document outlines the assessment details for the Economics 1B module, including instructions for a test worth 60 marks with a duration of one hour plus 10 minutes of reading time. It contains multiple-choice questions, true/false statements, and problem-solving questions related to economic concepts. Students are required to adhere to specific guidelines regarding independent work, use of calculators, and submission of their answer sheets.

Uploaded by

thandodlamini5556
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 4

22; 23; 24 2024

MODULE NAME: MODULE CODE:


ECONOMICS 1B PMAC6122/d/p
ECONOMICS 1B PMAC6112

ASSESSMENT TYPE: TEST (PAPER ONLY)


TOTAL MARK ALLOCATION: 60 MARKS
TOTAL HOURS: 1 HOUR (+10 minutes reading time)
INSTRUCTIONS:
1. Please adhere to all instructions in the assessment booklet.
2. Independent work is required.
3. Ten minutes is dedicated to reading time before the start of the assessment. You may make
notes on your question paper, but not in your answer sheet. Calculators may not be used
during reading time.
4. You may not leave the assessment venue during reading time, or during the first hour or during
the last 15 minutes of the assessment.
5. Ensure that your name is on all pieces of paper or books that you will be submitting. Submit all
the pages of this assessment’s question paper as well as your answer script.
6. Answer all the questions on the answer sheets or in answer booklets provided. The phrase
‘END OF PAPER’ will appear after the final set question of this assessment.
7. Remember to work at a steady pace so that you are able to complete the assessment within
the allocated time. Use the mark allocation as a guideline as to how much time to spend on
each section.
Additional instructions:
1. This is a CLOSED BOOK assessment.
2. Calculators are allowed.
3. For multiple-choice questions, give only one (1) response per question. The marker will ignore
any question with more than one answer, unless otherwise stated. You should, therefore, be
sure of your answer before committing it to paper.
4. Answer All Questions.
5. Show all calculations, where applicable (marks may be awarded for this).

© The Independent Institute of Education (Pty) Ltd 2024


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22; 23; 24 2024

Question 1 (Marks: 10)


Multiple choice questions: Choose one correct answer for each of the following. In your answer
booklet, write down only the number of the question and next to it, a symbol of the correct answer.

Q.1.1 Suppose that Germany can produce either four cars or 16 barrels of wine, (2)
meanwhile, South Africa can produce either two cars or eight barrels of wine. Based
on this information, it can be said that:
a) South Africa has an absolute advantage in the production of wine.
b) South Africa has an absolute advantage in the production of cars.
c) Germany has an absolute advantage in the production of wine.
d) Germany has an absolute advantage in the production of wine and cars.

Q.1.2 A monetary system where exchange rates are freely determined in response to the (2)
demand and supply of foreign currencies may best be described as a
a) Purchasing power parity system.
b) Floating exchange rate system.
c) Fixed exchange rate system.
d) Pegged exchange rate.

Q.1.3 In the simplest (or introductory) form of the Keynesian model, which of the (2)
following decisions cannot be analysed?
a) Saving of households.
b) Investment expenditure.
c) Consumption expenditure.
d) Investment by government.

Q.1.4 The marginal propensity to consume measures the relationship between: (2)
a) A change in consumption and savings.
b) Changes in consumption and changes in savings.
c) A change in consumption and a change in income.
d) The total level of consumption and the total level of saving.

© The Independent Institute of Education (Pty) Ltd 2024


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22; 23; 24 2024

Q.1.5 If aggregate expenditure is greater than total income, then: (2)


a) Planned savings will decrease in line with investment.
b) Output will increase to replenish depleted inventories.
c) Investment will decrease because such a high level cannot be sustained.
d) Investment will decrease to run down excessive inventories.

Question 2 (Marks: 10)


State either true or false for each of the statements below.

Q.2.1 Immigration is part of the trade policy. (2)

Q.2.2 If more Americans visit South Africa, then an appreciation of the rand relative to the
(2)
dollar can be expected.

Q.2.3 One of the important macroeconomic objectives is price fluctuations. (2)

Q.2.4 The gross domestic product (GDP) can be estimated by summing the value added by
(2)
all the different sectors of the economy.

Q.2.5 The unemployment rate as a percentage is usually calculated by dividing the number
(2)
of unemployed by the population.

Question 3 (Marks: 20)

Q.3.1 Graphically show the impact on the equilibrium R/$ exchange as a result of American
(4)
citizens decreasing their investments in South Africa. Explanation is not required.

Q.3.2 Identify and explain five macroeconomic objectives. (10)

Q.3.3 Differentiate between nominal gross domestic product (GDP) and real GDP. (4)

Q.3.4 State all the components of aggregate spending on South African production. (2)

© The Independent Institute of Education (Pty) Ltd 2024


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22; 23; 24 2024

Question 4 (Marks: 20)


Use the following information to answer Q.4.1 to Q.4.3. In a simple Keynesian model of the
economy, suppose that consumption spending amounts to R673m, while investment spending is
R429m, and the marginal propensity to consume is 0.80.

Note: Round off all your answers to two decimal places.


Q.4.1 Calculate the value of autonomous spending in the economy. (2)

Q.4.2 Compute the size of the multiplier in the economy. (3)

Q.4.3 Compute the equilibrium level of income in this economy. (4)

Q.4.4 Changes in government spending and taxation can be analysed in the Simple
(4)
Keynesian model of the economy. Do you agree? Justify your response.

Q.4.5 Define the term consumption function and describe the characteristics of the
(7)
consumption function.

END OF PAPER

© The Independent Institute of Education (Pty) Ltd 2024


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