GRADE 12
ECONOMICS
ASSIGNMENT
05 MARCH 2025
MARKS: 50 TIME: 1hour
This question paper consists of 5 pages
ECONOMICS GRADE 12 ASSIGNMENT 05 MARCH 2025
INSTRUCTIONS AND INFORMATION
1. Answer ALL questions in the ANSWER BOOK.
2. Number the answers correctly according to the numbering system used.
3. Read the questions carefully.
4. This assignment should be written under controlled supervision in the
classroom.
5. Write neatly and legibly.
7. Use only black or blue ink.
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ECONOMICS GRADE 12 ASSIGNMENT 05 MARCH 2025
QUESTION 1 CIRCULAR FLOW
1.1 Study the information below and answer the questions that follow
1.1.1 Identify the original autonomous consumption from the above information. (1)
1.1.2 Name any participant involved in deriving the value of multiplier. (1)
1.1.3 Briefly describe the concept marginal propensity to save. (2)
1.1.4 What impact will a tax increase have on multiplier? (2)
1.1.5 Explain the concept gross capital formation and its purpose to the economy. (3)
1.1.6 Calculate change in injection/expenditure from the above information . (4)
1.2 Explain the importance of financial institutions in the economy. (4)
1.3 How could an increase in investment contribute towards a higher national
income in the economy? (8)
[25]
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ECONOMICS GRADE 12 ASSIGNMENT 05 MARCH 2025
QUESTION 2 BUSINESS CYCLE
2.1 Study the extract below and answer the questions that follow.
BUSINESS CYCLES
The identification of source shocks is important in informing an optimal policy
response. Producers and consumers will not respond to the to the same extent of
initiating forces that are based on different business cycles. Business cycles can
range from 3 years to more than five years.
[Adapted from [Link] ]
2.1.1 Identify one factor that caused economic fluctuations. (1)
2.1.2 Name the type of business cycle caused by changes in investment of
equipment and machinery. (1)
2.1.3 Name ONE turning point of a business cycle (1)
2.1.4 Briefly describe the term recession (2)
2.1.5 Why is price stability important to prevent extreme fluctuations in business (2)
cycles?
2.1.6 Highlight the importance of fiscal policy in the economy. (2)
2.1.7 Explain the impact of contraction period on the economy (4)
2.2 How can SARB stimulate a weakened economy (4)
2.3 With the aid of a correctly labelled graph explain the demand and supply side
policies in smoothing out business cycle. (8)
TOTAL QUESTION 25 MARKS
TOTAL: 50
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ECONOMICS GRADE 12 ASSIGNMENT 05 MARCH 2025
CONTENT QUESTION LOW MIDDLE ORDER HIGH ORDER TOTAL
ORDER
CIRCULAR FLOW
BUSINESS CYCLE
TOTAL 10 24 16 50
20% 48% 32% 100%
