• Briefly describe the concepts related to the circular flow.

• Draw and interpret an open four-sector circular-flow diagram.

• Discuss the 4 participants and inter relationships between them:

- Household, business, state and foreign sector

- Real flows and money flows

- Show the relationship of the financial sector in the circular flow

• Justify the equality: L= J and indicate its component elements:

- Injections (J = I + G + X)

- Leakages (L = S + T + M)

• Brief explanation of an economy in equilibrium:

- Y = C + I + G + (X – M)

• Relate aggregate spending (consumption) to income.

• Explain concepts autonomous consumption and marginal propensity to consume (mpc)

• Discuss in detail the markets within the FOUR-SECTOR model:

- Factor markets: (labour, resource, capital)

- Product markets: (consumer and capital goods, durable, semi-durable and non-durable)

- Financial (monetary and capital)

- Foreign exchange market

- Link the operation of financial and foreign exchange markets to the participants of the circular flow

(Focus: Relevant concepts, deducing, interpretation, analyses of aggregates and conversions)

• Briefly describe the concepts GDP and GNP

• Briefly discuss the THREE methods to determine GDP:

- Production GDP(P)

- Income GDP(I)

- Expenditure GDP(E)

• Analyse, interpret and derive aggregates from data tables

• Analyse the national account conversions:

- Factor cost, basic prices, market prices

- Taxes and subsidies on production

- Taxes and subsidies on products

- GDP to GNP

• Explain the purpose of the System of National Accounts (SNA) as outlined by the United Nations (UN)

(Focus: Relevant concepts, calculations, interpretation or graphical explanation)

• Briefly describe the concept multiplier

• Explain of the multiplier process. (Relate to circular flow and examples).

• Calculate the value of the multiplier using the formulae:

- 1 1-mpc

- 𝟏 △ _y mps △ _Y △ _E

• Application of basic formula

• Graphical presentation to explain the multiplier. Draw the graph …

• Briefly describe the concepts

• Briefly explain the nature of business cycles

• Demonstrate/Illustrate a typical business cycle

• Use a diagram and briefly discuss the different phases in a business cycle

• Broadly outline the real business cycle

• Discuss the exogenous (monetarist) explanation

• Discuss the endogenous (Keynesian) explanation

• Compare both explanations

• Give a broad outline of the types of business cycles (Kitchin, Jugler, Kuznets and Kontratieff)

• Briefly explain the composition of the following policies:

- Fiscal policy

- Monetary policy

Discuss in detail 'The new economic paradigm'/Explain the 'smoothing of cycles'

- Explain demand-side policies.

Explain clearly how monetary and fiscal policies (expansionary and contractionary) can be used in smoothing out business cycles

Relate to inflation (peak) and unemployment (trough) by using the Phillips curve

- Explain supply-side policies and how aggregate supply can be stimulated through:

Reduction in costs

Improving efficiency in inputs

Improving efficiency in markets

• Explain the effect of demand-side and supply-side policies using a graph (aggregate demand and aggregate supply).

Briefly describe the relevant concepts

• Discuss in detail the features underpinning forecasting:

- Indicators

Leading

Coincidence

Lagging

Composite

- Length of a cycle

- Amplitude

- The trend line

- Extrapolation

- Moving averages

• Use a diagram and discuss the cycle length, amplitude and the trend line as features underpinning forecasting.

• Briefly describe the composition of the public sector

• Outline the necessity of the public sector:

- To supply public goods

- To conserve resources

- To manage the economy

• Discuss in detail how each of the following factors contributes to poor public sector provisioning:

- Accountability

- Efficiency

- Assessing needs

- Pricing policy

- Parastatals

- Privatisation/Nationalisation

• Discuss in detail the main objectives of the public sector in the economy

- Economic growth

- Full employment

- Exchange rate stability

- Price stability

- Economic equity

• Broadly outline the various budgets

• Emphasise public debt as a % of GDP

• Analyse current main budget data relating to:

- Taxes

- Sources of income

- Expenditure allocation

- Personal income tax tables (tax calculation)

• Differentiate between MTEF and MTBPS

• Identify how social rights are embedded in the budgets of the South African government

• Briefly discuss the following:

- The main variables (tax and government expenditure)

- Features of fiscal policy: goal-bound, demand-based, cyclical

• Discuss the effects of fiscal policy.

- Income distribution

- Consumption

- Price level

- Incentives/Disincentives in relation to the Laffer curve

- (Draw and interpret the Laffer curve)

- Discretion

• Briefly explain the key features of public sector failure.

- Ineffectiveness

- inefficiency

• Briefly explain the following reason(s) for public sector failure and link them to typical problems experienced through public sector provisioning:

- Management failure

- Apathy

- Lack of motivation

- Bureaucracy

- Politicians

- Structural weaknesses

- Special interest groups

• Broadly outline the following effects of public sector failure:

- Allocation of resources

- Economic instability

- Distribution of income

- Social instability

Infuse where appropriate: national macroeconomic policy and service delivery with regard to socio-economic rights, education, health and the environment, social security, convention of the rights of the child, taxation and compensation for human rights abuses.

• Discuss the following demand reasons:

- Size of population

- Income levels

- Change in the wealth of the population

- Preferences and taste

- The difference in consumption patterns

• Discuss the following supply reasons:

- Natural resources

- Climatic conditions

- Labour resources

- Technological resources

- Specialisation

- Capital

• Briefly discuss the following effects of international trade:

- Specialisation

- Mass production

- Efficiency

- Globalisation

Briefly describe the concepts

• Determine the value of the BoP

• *Explain the composition of the current BoP (which changed recently) in terms of the different accounts:

1. CURRENT ACCOUNT Goods exports

Net gold exports

Services receipts

Income receipts

less Merchandise imports

less Payment for services

less Income payments Current transfers (net receipts) Balance on Current Account Memo item: trade balance

2. CAPITAL TRANSFER ACCOUNT NET LENDING TO (+) OR BORROWING FROM (-) REST OF THE WORLD

3. FINANCIAL ACCOUNT

Net direct investment

Net portfolio investment

Net financial derivatives

Net other investments

Reserve assets

Balance on Financial Account

Memo item: balance on Financial Account excluding reserve assets

Unrecorded transactions

Briefly describe the concepts: corrections and deficit/disequilibria

• Briefly discuss the different measures to correct the BoP:

- Interest rates

- Import controls

- Borrowing and lending

- Change in demand

- Export promotion

- Import substitution

- Change in exchange rates

• Briefly describe the concepts (types of exchange rates, appreciation, depreciation, devaluation, revaluation, foreign exchange control)

• Supply and demand of foreign exchange

- Factors affecting demand

- Factors affecting supply

- Exchange rate equilibrium

- Changes to equilibrium (draw and interpret graphs)

- Interventions in the market

• Briefly explain the following exchange rate systems:

- Free floating

- Managed floating

- Fixed

• Describe the terms of trade under the following headings:

- Description

- Formula

- The effect on the economy

• Discuss in detail export promotion and import substitution:

- Definition

- Methods

- Reasons/Advantages

- Disadvantages

• Explain the arguments in favour of protection:

- Industrial development

- Infant industries

- Stable wage levels and high standard of living

- Increased employment

- Self-sufficiency and strategic industries

- Prevention of dumping

- Stable exchange rates and BoP

- Protection of natural resources

Briefly explain the following arguments in favour of free trade:

- Specialisation

- Economies of scale

- Choices/Increased welfare

- Innovations/Best practice

- Improved international relations

• Briefly describe the concept desirable mix

• Briefly explain the desirable mix between:

- Import substitution and export promotion

- Protection and free trade

• Explain trade liberalisation and the role of the World Trade Organisation (WTO) as part of globalisation

• Briefly explain the different forms of economic integration (cite appropriate examples)

• Briefly evaluate the following South Africa's trade policies:

- Import substitution and export promotion

- Protection and free trade

• Briefly evaluate the successes and failures of the following South Africa's trade protocols:

- Southern African Custom Union (SACU)

- Multilateral Monetary Area (MMA)

- Southern Africa Development Community (SADC)

- African Union (AU)

- European Union (EU)

- Mercusor

- AGOA

- Japan – South Africa's Partnership Forum

- Brazil, Russia, India, China and SA (BRICS)

• Briefly describe the concept

• Examine the characteristics of a perfect market

• Distinguish between individual businesses and the industry.

• Use graphs to explain the derivation of the demand curve for the individual business.

• Construct a revenue table to show that D= P=AR=MR

• Use graphs to explain profit maximisation using:

- Total cost and total revenue curves

- Marginal cost and marginal revenue curves

• Derive the supply curve from cost curves

• Briefly describe the concept

• Compare and contrast the FOUR broad types of market structures (perfect competition, monopolistic competition, oligopoly and monopoly) in detail in terms of the following.

- Number of businesses

- Nature of product

- Entrance

- Control over prices

- Information

- Examples

- Demand curve

- Economic profit/loss

- Decision-making

- Collusion

- Productive/Technical efficiency

- Allocative efficiency

• Examine in detail the various equilibrium positions with the aid of graphs.

- Explain economic profit, economic loss, normal profit with the aid of graphs (short run)

- Explain normal profit with the aid of a graph (long run)

- Explain shutdown point using costs and revenue (FC, VC, TC, TR) and explain graphically (AR and AVC)

Show the relationship between the industry equilibrium positions and the individual firm’s equilibrium positions with graphs, i.e. how entry and exit into the market influence equilibrium position from the short run to the long run.

• Briefly describe the competition policies

• Outline the aims/objectives of the competition policy

• Briefly describe SA's anti-monopolistic policy

• Briefly describe the Competition Act, 1998 (Act 89 of 1998), as amended

• Explain the role of the Competition Commission, Competition Tribunal and Competition Appeal Court

• Give your opinion of the successes/failures of the competition policy. (relate to current examples)

• Explain the following in an imperfect market:

- Income/Revenue

Revenue schedule (a review)

Average and marginal revenue curves

- Costs

Cost schedule (a review)

Average and marginal cost curves

Discuss the monopoly in detail

• Briefly describe the concept

- Emphasise and highlight good practical examples of businesses in this market

• Examine the characteristics in detail

• Distinguish between natural and artificial monopolies

• Explain the downward slope of the demand curve (AR)

• Explain the marginal revenue curve (Show the relationship between the demand curve (AR) and the MR curve graphically)

• Explain, with the aid of graphs, economic profit and economic loss

• Explain the long-run equilibrium position with the aid of a graph

• Compare the monopoly with a perfect competitor in terms of demand curves, products, prices, output, equilibrium positions

• Examine the oligopoly in detail

• Briefly describe the concept

- Emphasise and highlight good practical examples of businesses in this market

• Examine the characteristics of the oligopoly

• Briefly discuss non-price competition

• Briefly discuss collusion (relate to current examples of collusive behaviour)

- Distinguish between overt collusion (cartels) and tacit collusion (price leadership)

• Broad outline of prices and production levels

• Broad outline of the rationale of the kinked demand curve

• Use the graph and briefly explain why oligopolists are reluctant to compete on prices.

• Compare the oligopoly with a perfect competitor in terms of demand curves, products, prices, output, equilibrium positions and non-price competition.

• Briefly describe the concept

- Emphasise and highlight good practical examples of businesses in this market.

- Briefly discuss product differentiation in this market

• Examine the characteristics

• Briefly discuss non-price competition (emphasise, amongst others, advertising, product differentiation and branding among other examples non-price competition)

• Broad outline of prices and production levels

Compare all FOUR market structures (perfect competition, monopolistic competition, oligopoly and monopoly)

•Discuss in detail how the following factors lead to the misallocation of resources in the market:

- Externalities

- Missing markets

- Imperfect competition

- Lack of information

- Immobility of factors of production

- Imperfect distribution of income and wealth

• Compare the following inefficiencies with the aid of a well-labelled graph:

- Productive inefficiency

- Allocative inefficiency

• Describe the following with the aid of well-labelled graphs:

- Negative externalities

- Positive externalities

• Discuss in detail state intervention as a consequence of market failures, with the aid of relevant graphs

- Direct control

- Imperfect markets

- Minimum wages

- Maximum prices

- Minimum prices

- Taxes and subsidies

- Subsidies on goods and services

- Redistribution of wealth

- Government involvement in production

• Briefly describe the concept cost-benefit analysis

• Briefly describe the reasons for a CBA

• Apply the CBA in practice

Compare South African growth and development policies in terms of international benchmarks; also highlight the North/South divide

• Distinguish between growth and development

• Discuss in detail the demand-side approach in promoting growth and development in South Africa

- Give an overview of the demand-side approach:

The monetary policy (interest rate changes, open market transactions, moral suasion)

The fiscal policy (progressive personal income tax, wealth tax, cash benefits, natural benefits, other redistribution, land restitution and redistribution, subsidies on property)

• Discuss in detail the supply-side approach in promoting growth and development in South Africa

- Give an overview of the supply-side approach:

Efficiency and effectiveness of markets

Business efficiency

The cost of doing business

The factors of production (natural resources, human resources, capital, entrepreneurship, technology)

• Briefly evaluate the following South African growth and development policies and strategic initiatives:

- Reconstruction and Development policy (RDP)

- Growth, Employment and Redistribution Programme (GEAR)

- National Skills Development Strategy (NSDS)

- Accelerated and Shared Growth Initiative for South Africa (AsgiSA)

- Joint Initiative on Priority Skills Acquisition (JIPSA)

- Expanded Public Works Programme (EPWP)

- The New Growth Path (NGP)

- National Development Plan (NDP)

- Small Business Development Promotion Programme

- Black Economic Empowerment Programmes

Compare countries in the North to those in the South with respect to the following:

- Unequal standards of living (per capita income, life expectancy, education)

- Challenges of globalisation (poverty, growth, trade)

- Environment (countries in the North, countries in the South)