DEVELOPMENT STUDIES

PAPER TWO
MODULE 2 PRODUCTION, INVESTMENT & CONSUMPTION
 MATER SPEI COLLEGE (ii) Suggest problems that people might face when they own land communally.

DEVELOPMENT STUDIES - The problem that people might face when they own land communally is that land
may be degraded or people ignore good practices
Module 2: Production, Consumption & Investment
- The problem that people might face when land is communally owned is that of
Paper 2 overgrazing or overstocking

1. Study Fig. 1 which shows different types of land ownership. - Soil erosion is the problem that people might face when land is owned
communally.

- The banks reject land owned communally as a form of security for loan

- The deforestation may occur if land is owned communally, for example, cutting
down trees for firewood

- The problem faced by people when land is owned communally is that of over
harvesting of veld products or depletion.

- The conflicts over usage of land may take place if the land is owned communally.

- The land can be taken anytime by the government if it is owned communally

- The communal land cannot be sold

(a)(i) Describe each type of land ownership shown in Fig.1.
- Failure to develop the land
- Collective land ownership is when people in the local community own and use
land together, for example, in Tanzania after independence families owned chunks (b)(i) Describe the use of any three factors of production in hunting and gathering society.
of land together, shared work and farming machinery.
- The Land is used in Hunter gatherers for hunting wild animals and collecting
- Private land ownership is the land owned by individuals and companies, for fruits and plants in their territories
example, Molapo estate in Francistown and Phakalane in Gaborone.
- Labour in hunting and gathering societies is provided by members of tribe/labour
- Public land ownership is when the state or nation owns land. There are rules on is divided according to gender where men hunt and women gather
who has the right to fields. For example, Botswana and Lesotho of Land
Board/Land committee. - Capital in Hunter gatherers own simple tools for hunting/own simple bows,
poisoned arrows, clubs
- Renting land ownership is when people use land through paying the owner some
amount of money or annually - Entrepreneurship : Hunter-gatherers use traditional knowledge and skill passed
down to them by their ancestors over the years
- Share cropping land ownership is when people use somebody’s land to grow
crops, for farming and pay the land owner with part of the harvest or crop.

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Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
 (ii) Suggest reasons why hunting and gathering is practised by very few societies MATER SPEI COLLEGE
today.
DEVELOPMENT STUDIES
- The reason why hunting and gathering is practised by very few societies is that of
increased population/ people are more than wild animals /shortage of land
Module 2: Production, Consumption & Investment
- The establishment of game reserves and national parks lead to hunting and
gathering being practised by very few societies today. Paper 2

- The hunting and gathering is practised by very few societies today because of
environmental laws that controls hunting of wild animals.

- The government development plans which need people to be settled

- Cordon fences that restrict movement of wild animals lead to having few societies
still practising hunting and gathering today.

- Modernisation of hunter gatherers, for example, need to attend formal schools

- Outbreak of diseases attacking wild animals

- Provision of water by government, for example, boreholes.

- Encroachment of pastoral farming into wildlife areas.

- Overgrazing that has depleted edible plants.

- Construction of cordon fences that has disrupted migratory routes of wild

animals.

- Increased population that has reduced the land available for a nomadic life.

- Government resettlement programmes like Remote Areas Dwellers (R.A.D)

- Increasing levels of education amongst the Basarwa.

- Anti-poaching laws that prevent Basarwa from hunting

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Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
(a)(i) Describe each type of land ownership shown in Fig. 1. (b)(i) State the problems of using a capital intensive method of production for a
developing country.
- Communal land ownership refers to land owned by the tribe or society or land
boards oversee land allocation or land is accessible to a group of people without - The problem of using a capital intensive method of production for developing
owning it. country is that pollution to the environment is common or it causes pollution to the
environment due to the use of complex technology.
- Public land ownership refers to land that belongs to government or state or the - Capital intensive leads to high unemployment rate because of the use of complex
government uses land for its purposes, for example, building dams, schools and technology which require few people to operate.
game reserves or state authority or land boards oversee land allocation. - The problem of using capital intensive method of production in a developing
country is that it leads to loss of craftsmanship or skills or loss of culture.
- Capital intensive method of production requires skilled labour or does not absorb
- Private land ownership refers to land owned by individuals or companies or unskilled labour because of the use of complex technology.
owner is free to buy and sell land or owner has title deed. - The problem of using capital intensive method of production for a developing
country is that it can lead to use of inappropriate technologies.
- Renting refers to land that is being used by a person other than the owner and - Capital intensive method of production may lead to depletion of natural resources
paying a (monetary) fee for usage or a tenant uses land and pays money to the because it depends on the use of complex technology.
landlord or owner. - The problem caused by capital intensive method of production is that of land
degradation due to the use of complex technology, for example, deforestation and
(ii) Land ownership in Botswana is largely communal. Suggest problems that soil erosion.
communities in Botswana might face in trying to improve production in agriculture.
(ii) Explain how developing countries can raise capital for production.
- The problem that communities in Botswana might face in trying to improve
production in agriculture is that land cannot be sold to raise capital. - The developing countries can raise capital for production through international
loans or borrowing.
- The problem that communities in Botswana might face in trying to improve - The privatisation of parastatals or selling of parastatals shares can help developing
production in agriculture due to communal land ownership is that the user is unable countries to raise capital for production.
to use it as collateral or security to obtain loan. - The developing countries can raise capital for production through taxation, for
- The communities in Botswana might face the problem of land degradation or soil example, income tax paid by employees or workers and value added tax (VAT)
erosion or deforestation in trying to improve production in agriculture because of paid by consumers.
land communal ownership. - The capital for production in developing countries can be raised through licensing,
- There is easy spread of animal and plants diseases or pests. for example, business licenses, driver’s licenses and hunting licenses.
- The problem that communities in Botswana might face in trying to improve - The developing countries can raise capital for production through fees, for
production in agriculture is that of unfair distribution of land or corruption. example, school fees.
- The land ownership in Botswana is largely communal which makes it impossible - The capital for production in developing countries can be raised through penalties
to control breeding. to people who break the law, for example, over speeding fines or speed traps.
- There can be conflict over usage of land to improve agricultural production by - The capital for production in developing countries can be raised through lotteries.
communities in Botswana because land ownership is largely communal. - The developing countries can raise capital for production through joint venture, for
- The problem faced by communities in Botswana to try and improve agricultural example, the government of Botswana and Debeers which is responsible for
production is because land can be taken anytime by the government or people can mining and selling diamonds.
be relocated anytime to pave way for developments.

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Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
 MATER SPEI COLLEGE (a)(i) Describe each factors of production shown in Fig.1 above.

- Land refers to the whole of the earth’s surface together with all natural resources found
DEVELOPMENT STUDIES
on it

Module 2: Production, Consumption & Investment - Labour refers to the human effort, both physical and mental, that is directed towards
the production of goods and provision of services / OR work done by people to produce
Paper 2 goods and services

- Capital refers to things people use to produce goods and provide services (e.g. tools,
1. Study Fig. 1 which shows factors of production and answer questions 1(a)(i) and machinery, and factories) and money saved up and used to buy such things.
(ii).
- Enterprise is the organization (management) of land, labour and capital in the
production process with the intention of making profit.

*Simple mentioning without definition is unacceptable

(ii) Suggest two ways by which any three of the factors of production mentioned above
can affect the production process.

Land:

- If land is unfertile crop production will be low / poor pasture for livestock

- If there is shortage of water there will be poor harvest / poor pasture for livestock

- There has to be land to start a production process

Capital:

- Capital / money is needed to pay workers

- Capital is needed to buy machinery and tools

- We need capital goods to start a production process

Labour:

Fig. 1 - There is need for workers to provide labour in the production process

- The labour has to be trained & motivated to be efficient / productive

- The labour needs to be managed and/or coordinated for optimum production

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Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
 (b)(i) Describe the characteristics of production amongst the hunting and gathering MATER SPEI COLLEGE
societies .
DEVELOPMENT STUDIES
- Simple technology/tools/labour intensive
Module 2: Production, Consumption & Investment
- Gender based division of labour/women gather/men hunt
Paper 2
- Communal use of land/hunting areas
1. Study Fig. 1 which is an extract about Rural Industries Innovation Centre (RIIC).
- Dependence on natural resources

- Subsistence production

- Craftsmanship production/use of traditional skills

(ii) Describe ways of raising capital for production. Fig.1

- The way of raising capital for production is through saving which is abstaining
(a)(i) Describe factors which might make solar energy appropriate for Botswana.
from consumption and putting the money in the bank to earn interest.

- The capital for production can be raised through borrowing from the banks and - The factor which might make solar energy appropriate for Botswana is that of
financial institutions.
having many months of sunshine/ sunshine is readily available
- The way of raising capital for production is through International loans from
other countries, the World Bank and International Monetary Fund.
- Solar energy is appropriate for Botswana because it is clean /environmentally
- The capital for production can be raised through investment which is putting friendly.
money into a business with the hope of earning profit.

- The way of raising capital for production is through shares which is putting money - The Rural Innovation Industries Centre (RIIC) can develop/install/maintain any
in the business to get a certain percentage of profit made.
required solar machines.
- The capital for production can be raised through Taxation which is done by the
government. It taxes workers and companies to raise money for development.
- Solar energy is easy to use.

- Solar energy is affordable.

- It can be set up in rural area [where most Batswana live]

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Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
 (ii) Suggest problems that the Rural Industries Innovation Centre might face in their MATER SPEI COLLEGE
effort to disseminate new developments.
DEVELOPMENT STUDIES
- It takes long to conduct proper needs assessment to decide products and
technologies to develop Module 2: Production, Consumption & Investment
- Feasibility of developing some technologies requested by clients is low due
sophistication/lack of knowledge or skills by RIIC Paper 2
- Batswana are slow to adapt to new technologies/are traditional so they fail to
support RIIC/Low literacy making people to be rigid [Link] Fig. 1, which shows an assembly line in a car factory, and use it to answer
- Recession/ shortage of money to conduct research/ high cost to RIIC
- Batswana shun most non-agricultural technologies
questions (a)(i) and (ii).
- Most Batswana may lack money to buy such technologies

(b)(i) Describe the importance of Information Technology (IT) in the development of

Botswana.

- The importance of information technology in the development of Botswana is

that it helps store a lot of data
- Information technology helps with easy analysis of complex information
- The importance of information technology is that of easy/fast transfer of
information from one source to another
- Information technology promotes international trade by linking
countries/electronic payments made possible
- The importance of information technology is that of increased productivity
- Information technology helps with development of infrastructure
- Improvement of technology/skills development

(ii) Suggest factors that might slow down the introduction of Information Technology
(IT) in Botswana schools.

- Shortage of information technology (IT) teachers to teach information technology

(IT)
- Information technology equipment are also to expensive, for example, computers
- Large populations of students in schools/lack of IT equipment
- Some schools are located in remote areas or places without proper supporting
infrastructure, for example, electricity and telephone connections
- Information technology [IT] equipment is easily stolen/theft
- Some students/teachers have a phobia for electronic machines

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Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
(a)(i) Describe the factors that increase the efficient of labour. (b)(i) Describe any three forms of specialisation in production.

- The labour efficiency can be promoted by increased leisure or rest - Specialisation by Individual is when a person concentrates or gives great
attention to one task only, for example, a Development Studies teacher, a dentist,
- The factor that can increase labour efficiency is that of education/training, the an optometrist.
higher the level of training and education the higher the level of productivity. - Specialisation by Product is when an individual or company concentrates on or
gives great attention to making a single commodity, for example, Nortex Company
- The labour efficiency can be increased through motivation, for example, workers in Francistown which produces towels
can be encouraged to work harder by being offered incentives such as higher - Specialisation by Nation is when a country concentrates on producing a certain
wages, rewards, promotion at work and bonuses/13th cheque good(s) / commodity (ies) which they have comparative advantage over, for
example, Botswana produces beef and diamonds, Namibia produces fish, etc.
- The factor that increase labour efficiency is that of improved working conditions, - Specialisation by Region is when countries of the same geographical area
for example, well ventilated workplace/ventilation. concentrate on or give great attention to a particular product, for example, The
basketry in North West Botswana, phane harvesting in the Central and North East
- The labour efficiency can be increased through improved technology, for example, Botswana
if workers use simple technology then productivity will be lower. Workers who - Specialisation by Process is when a company concentrates on or gives great
use advanced technology will be more productive. attention to various aspects of a product, for example, at a car assembly plant there
are different areas of specialisation in the process of assembling a car; there is a
- The good leadership can help to increase labour efficiency. person responsible for fitting the engine, the wheels, the windscreen, the wipers,
the gearbox etc.
- The labour efficiency can be increased through specialisation and division of
labour (ii) Suggest factors that may reduce labour efficiency among workers in Botswana.
- The workers welfare can help to increase labour efficiency because workers must
have peace of mind for them to be productive at work, for example, pension and - The factor that may reduce labour efficiency among workers in Botswana is that
medical aid schemes of poor work ethics/laziness/culture of laziness/absenteeism from work
- The alcoholism/drug abuse may reduce labour efficiency among workers in
- Labour efficiency can be increased by good work ethics ( coming to work on time) Botswana.
- The labour efficiency in Botswana may be reduced by dirty unattractive working
(ii) Describe the advantages of specialisation of labour. conditions
- The low wages/salaries may reduce labour efficiency among workers in Botswana.
- The advantage of specialisation of labour is that work can be done faster and - The Poor supervision/management may reduce labour efficiency among workers
perfectly because the worker perform only one task. in Botswana.
- The advantage of specialisation of labour is that little time is wasted moving from - The factor that can reduce labour efficiency among workers in Botswana is lack of
one task to the other. training.
- There is a chance of exploring people’s potential during specialisation of labour. - The lack of machines/equipment/tools to use may reduce labour efficiency.
- Specialisation of labour is cheaper and time saving to train in one particular job. - The crippling effect of deadly diseases such as HIV/AIDS and Covid-19 causes
- The quality goods and services are produced because of use of advanced reduction in labour efficiency among workers in Botswana.
technology. - The poor/congested transportation routes causing late arrivals at work , for
- There is higher productivity because of the use of machinery. example, Gaborone/ poor infrastructure
- Specialisation of labour increases worker’s proficiency because of constant - The factor that may reduce labour efficiency among workers in Botswana is that
repetition. of lack of motivation
- Specialisation of labour creates a lot of employment opportunities, for example,
teaching

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Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
 MATER SPEI COLLEGE (ii) Describe the disadvantages of a planned economy.

DEVELOPMENT STUDIES
- The disadvantage of planned economy is that it is difficult to plan for the whole
country and these results in a lot of mistakes.
Module 2: Production, Consumption & Investment

Paper 2 - Planned economy suppresses individual freedom to think and act.

1 Fig. 1, which shows world economies and answer question 1(a) - In planned economy, state appointed managers are inefficient because they are
appointees rather than entrepreneurs.

- There is technological inefficient because managers are prohibited coming up with

new ideas or make changes.

- In planned economy very few luxury goods are produced hence the people’s lives
are uncomfortable.

- The disadvantage of planned economy is that a very limited choice for consumers
since all goods and services are produced by the state.

- There is a low productivity level because of over-employment, inefficient

management and low morale of the workers
Fig.1
(b)(i) Describe the benefits of localisation to Botswana.

(a)(i) State five characteristics of a market economy.

- The benefit of localisation to Botswana is to promote socio-economic development of
locals.
- Private property is when individuals have the right to own and control the means - Localisation is part of restoring national pride and asserting a country’s independence.
of production, for example, labour, land and capital.
- Freedom of choice is when people are free to choose what to produce, how to - Localisation helps in making Batswana believe in themselves and not always show too
produce and where to produce. much respect for foreigners.
- Freedom of enterprise is when people are free to start businesses of their choice.
- Self- interest is when people are motivated by the need to make profits for - The benefit of location to Botswana is that citizens will occupy politically sensitive
themselves. positions
- Competition is when businesses compete against each other. - Localisation creates employment for citizens.
- Price mechanism is when the laws of supply and demand determine the prices for
goods and services. - The benefit of localisation is that development is in accordance to culture
- Government role is minimal which means there is little government interference - There is possibility of making long term decisions as there is no fear of end of contract
with the running of the economy. - Localisation helps locals acquire necessary skills
- The workers are patriotic and have their national interest at heart
- The benefit of localisation is that it saves money wasted on foreigners .

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Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
(ii) Suggest ways in which a government can empower its people. MATER SPEI COLLEGE

DEVELOPMENT STUDIES
- The government can empower its people through training and educating citizens, for
example, Local Enterprise Authority which trains locals on entrepreneurial skills. Module 2: Production, Consumption & Investment
- The people can be empowered by government through provision of financial
Paper 2
assistance, for example, Citizen Entrepreneurial Development Authority (CEDA) and
1. Study Fig. 1, which shows economic production systems.
National Development Bank (NDB)
- The government can empower its people by providing opportunity for locals to vote in
elections
- The provision of information through radio, television, newspapers on various issues
also help to empower people.
- The government empower its people through provision of health services to fight/
cure/control/treat diseases
- The government can teach locals their rights as a way of empowering them.
- The government is providing a market to citizens or tenders as a way of trying to Fig.1
empower them.
- The marketing of local goods and services to outside markets helps to empower people (a)(i) Describe the characteristics of a planned economic production system.
by government. - Private property is when individuals have the right to own and control the means
- The government can empower its people through localisation which is replacing of production, for example, labour, land and capital.
expatriate public servants with citizens. - Freedom of choice is when people are free to choose what to produce, how to
- The government can help to empower its people through privatisation which is the produce and where to produce.
transfer of state assets to individuals and companies usually through selling. - Freedom of enterprise is when people are free to start businesses of their choice.
- The government can empower its people by reserving some businesses for locals only.
- Self- interest is when people are motivated by the need to make profits for
themselves.

- Competition is when businesses compete against each other.

- Price mechanism is when the laws of supply and demand determine the prices for
goods and services.

- Government role is minimal which means there is little government interference

with the running of the economy.

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Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
(ii) Explain the disadvantages of a market economic production system. -
(ii) Explain the benefits of choosing a mixed economic production system.
- The economy responds quickly to the people’s needs and wants.
- In a market economic system entrepreneurs always try to use the resources as - The government social welfare programme ensures that everybody has access to
efficiently as possible in order to get the most profit out of them. basic needs.
- The advantage of market economic system is that high quality goods and services
because of fierce competition. - The government labour laws protects workers from exploitation through coming
- The advantage of market economic system is that entrepreneurs are always up with labour laws.
motivated to make a success of their businesses because they want to make profit.
- The market economic system is highly productive because of the use of mass - The benefit of choosing a mixed economic production system is having
production methods. environmental laws that prevent damage to the environment.
- Capitalist countries have achieved the highest levels of development in the world,
for example, japan and U.S.A. - The presence of government businesses or parastatals ensures availability of
- The advantage of market economic system is that anyone has the chance to become essential goods and services, for example, water and electricity.
rich provided he or she has the business skills.
- The government price control ensures that basic needs are sold at affordable prices,
(b)(i)Describe the features that show that Botswana follows a mixed economic for example, water, electricity, mealie meal and petrol.
production system.
- The government laws and regulations prevent immorality, for example, banning of
- The feature that show that Botswana follows a mixed economic production system pornographic materials. The element of freedom of enterprise allows high
is that parastatals operating side by side with the private businesses. For example, achievers to excel.
Botswana Power Corporation and Choppies.

- The prices determined by market forces while the government controls prices for
some goods and services, for example, petrol and maize meal.

- The government schools and universities such as University of Botswana and

Botswana International University Of Research Science and Technology operating
alongside private schools and universities such as Botho College and Baisago
University College.

- The government hospitals and clinics operating alongside private hospitals and
clinics. For example, Nyangagwe Hospital in Francistown and Riverside Hospital
in Francistown. The government prepares National Development Plans while
individuals implement them.

- The government set regulations for business operations such as quality control,
price monitoring while individuals are free to make other decisions.

- The government gives free food or basic needs to destitute while other people must
buy for themselves. The government exempts the poor from paying school fees

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whilst other people pay.

Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
 MATER SPEI COLLEGE (ii) How can an entrepreneur raise capital for production?

DEVELOPMENT STUDIES - An entrepreneur raise capital for production from personal savings/insurance
policies
Module 2: Production, Consumption & Investment
- An entrepreneur can raise capital for production through selling of shares
Paper 2
- An entrepreneur can raise capital for production by getting loans from financial
institutions/banks

- An entrepreneur can raise capital for production from grants/donations

- An entrepreneur can raise capital from leasing or renting out property

- An entrepreneur can raise capital for production from hire purchase

- An entrepreneur can raise capital from debenture [loan from the public]/family
members/friends

- An entrepreneur can raise capital for production from sale of assets

(a)(i) What are the qualities of a good entrepreneur?

Most women entrepreneurs start as sole proprietors in the informal sector.

- A good entrepreneur is that of been innovative/creative in the running of the
business
(b) (i) Give the characteristics of a sole proprietorship.
- A good entrepreneur come with initiative/self-motivated
- The characteristic of a sole proprietorship is that owner gets the profit or bears the
- A good entrepreneur has good organisational skills/good planner/good losses
manager/interpersonal skills
- The sole proprietor employees are mostly members of the family
- A good entrepreneur is a risk bearer/capability to bear risk
- Sole proprietor is usually found within the location of the owner
- A good entrepreneur is a good motivator of employees
- The characteristic of sole proprietor is that it has got small sphere of influence
- A good entrepreneur is a good decision maker
- The sole proprietor has got unlimited liability
- A good entrepreneur is a hard worker/productive

- A good entrepreneur is able to move with the times

- A good entrepreneur is a good leader/loyal to workers/good

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communicator/responsible/lead by example

Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
(ii) Describe the disadvantages of operating as a sole proprietor in the informal sector. MATER SPEI COLLEGE

- The disadvantage of a sole proprietor is that individuals usually have small DEVELOPMENT STUDIES
amounts of capital and this might hinder the expansion of the enterprise.
Module 2: Production, Consumption & Investment
- The success of the business depends on the owner’s abilities, and on his or her
death or retirement, the business might be affected by the person who inherits it. Paper 2

- If the inheritor is not a good business person, the company will obviously collapse. 1 Study Fig. 1 which is an extract on parastatals.

- Since the individual owner bears all the risks, the owner is liable for all the debts
and losses of the firm.

- Sole trader has got limited liabilities which means the owners assets are at risk.

- Sole trader is at times has difficulties to get money or loan to finance the business
Fig.1
since banks need security.
(a)(i)With the aid of Fig. 1, describe characteristics of parastatals.
- There are no economies of scale. This means the sole trader cannot buy in bulk to
experience discounts. - The parastatals are established by an Act of parliament/set up by the government
- The parastatals are owned by the government/assets are publicly owned
- The division of labour may be difficult to organise because of the small size of the
- The Chief Executive Officer (CEO) handle daily operations/daily management of
business, resulting in little sharing of the workload, hence the owner is overworked.
parastatals
This may affect productivity and labour efficiency.
- The parastatals are funded by the government
- The profit made by parastatals goes to the government
- The parastatals focus on the provision of useful goods and services
- The parastatals are engaged in large scale businesses

(ii)Suggest benefits of operating parastatals to a developing country.

- Parastatal prevent duplication of production which is wasteful

- Parastatals allows for economies of scale because they are large
- Parastatals ensures that essential goods and services are available even though are
expensive to produce/provide, for example, water supply and electricity supply
- Parastatal provide sufficient capital for large scale development/ source of
income for the government
- Parastatals rescue dying industries in order to protect employment
- Parastatals helps to create employment for people in developing countries.
- Parastatals helps the government to implement its policies
- Parastatals industries of strategic importance are in the hands of the government
rather than private individuals, for example, atomic power/electricity

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- Parastatal also serve as a strategy to promote industrialisation in the country
- The parastatals are source of foreign exchange for developing countries.

Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
(b)(i) Explain why some parastatals have been privatised. MATER SPEI COLLEGE

- Some of parastatals have been privatised to increase wealth of a country, for DEVELOPMENT STUDIES
example, GDP and GNP
- The parastatals are privatised to raise capital from sale of shares Module 2: Production, Consumption & Investment
- The government may decide to privatise some parastatals to reduce the burden of
running production for the government/reduce expenditure of the country /reduce Paper 2
government spending on daily running of businesses
- The parastatals are privatised to encourage more people to own shares as a way of 1 Study Fig. 1 which shows a weaving co-operative.
promoting citizen empowerment
- Some parastatals are privatised to encourage competition in some business areas
where there is monopoly
- The government privatised some parastatals to reduce trade union power since
private companies are less likely to give into demands by unions
- Some parastatals are privatised to increase efficiency in production since private
productions will respond to market forces/ to reduce bureaucracy
- Some parastatals are privatised to reduce political interference from the businesses
- The government may decide to privatise some parastatals as a way of attracting
foreign direct investment (FDI) so that individual companies pay tax

(ii) Suggest problems that may be caused by privatisation.

- The problem caused by privatisation is that many privatised assets are sold too
cheaply so tax payer loses/ encourages corruption

- Privatisation may sometime lead to shares or businesses be in the hands of foreign

companies so profits will go out of the country.

- The shares during privatisation are often bought the rich businesses so locals fail
to participate/widens the gap between the rich and poor
Fig. 1
- Privatisation may result in lower wages/poor working conditions for
workers/exploitation of workers (a)(i) With the aid of Fig. 1, describe the advantages of being a member of a co-
operative.
- Sometimes privatisation simply changes state monopoly to a private monopoly.
- The benefit of being a member of a farming co-operative is that of skills sharing/
- Privatised businesses often reduce workforce/loss of employment. members learn new skills
- The farming co-operative makes it easy for members to raise a high amount of
- Private companies are profit driven so they fail to take care of the environment, for capital/group investment
example, pollution. - The benefit of being a member of farming co-operative creates opportunity for
- Attempts to make profit often result in higher prices making consumers suffer. division of labour/sharing of tasks

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- The members of a farming co-operative share ideas

Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
 - The benefit of being a member of farming co-operative is that of collective decision
making/ good decisions are made (b)(i) Describe ways by which an entrepreneur can raise capital for production.
- The farming co-operative improves marketing of products
- The benefit of being a member of farming co-operative is that of easy access to
- The way by which an entrepreneur can raise capital for production is from personal
financial assistance from financial institutions
savings/insurance policies
- The benefit of being a member of farming co-operative is that of sharing of a
common market to reduced competition
- An entrepreneur can raise capital for production through selling of shares
- The members of a farming co-operative benefit from collective saving which gives
them opportunity for bigger interest rates
- An entrepreneur can raise capital for production by getting loans from financial
- The benefit of being a member of farming co-operative is that of cost sharing, for
institutions/banks
example, transport is shared so the cost is shared
- The members of farming co-operative benefit from bulk buying of raw materials
- An entrepreneur can raise capital for production from grants/donations
which inputs makes them cheaper
- The benefit of being a member farming co-operative is that of poverty alleviation
- An entrepreneur can raise capital from leasing or renting out property
- The benefit of being a member of farming co-operative is that of employment
creation
- An entrepreneur can raise capital for production from hire purchase
(ii) Suggest how a government can ensure that co-operative are successful.
- An entrepreneur can raise capital from debenture [loan from the public]/family
members/friends
- The government can ensure that co-operatives are successful providing training on
entrepreneurial skills or upskilling - An entrepreneur can raise capital for production from sale of assets

- The co-operative are successful because government provide storage facilities (ii) Explain the importance of capital in production.

- The government can ensure that co-operatives are successful by provide funding
- The importance of capital in production is that money is used in infrastructural
or financial assistance
development, for example, buildings and roads
- The government improve transport networks as a way of ensuring that co-
- The money is used to buy equipment during production.
operatives are successful.
- The importance of capital in production is that money is used to buy raw materials
- The government can ensure that co-operatives are successful by providing
technological assistance or invest in technological development
- The importance of capital in production is that money is that money is used to pay
workers
- The government can assist or help co-operatives with quality assurance or
standards, for example, Botswana Bureau of Standards (BOBS)
- The importance of capital in production is that money is that money is used to pay
utilities such as water and electricity bills
- The government can ensure that co-operative are successful by providing
- The importance of capital in production is that money is that equipment is used to
mentoring or giving expert advice or incubation strategy
transform or change raw materials into semi-finished and finished goods
- The importance of capital in production is that money is that buildings house the
- The government can help market the products or services/ provide a market for the
machines/products
cooperatives
- The importance of capital in production is that money is that cars are used for

14
transportation
- The government can ensure that co-operatives are successful by providing subsides

Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
 MATER SPEI COLLEGE (ii) Describe ways in which the government helps local entrepreneurs.

DEVELOPMENT STUDIES - The government can help local entrepreneurs by organising markets for local producers

Module 2: Production, Consumption & Investment - The local entrepreneurs can be helped by government through tax holidays [which is
allowing newly established from pay tax for a certain period of time and subsidies is
Paper 2 covering part of expenses on materials used in production]

1 Study the extract below and use it to answer question 1(a). - The way in which government can help local entrepreneurs is through protecting infant
industries, for example, Import Substitution Strategy and Export Oriented Strategy can
Most of the large commercial farmers in Namibia belong to a co-operative such as Agra. be used to protect local industries from competition
Co-operatives can also be of great benefit to subsistence farmers and they have been set up
in a number of African countries. - The government can help local entrepreneurs by making some production exclusively
for locals, for example, saloons and transportation such as buses and taxies industry
Adapted from: Development Studies 1 by Mweti and Van Wyk
- The government can help local entrepreneurs by providing them with Training, for
Fig.1 example, Local Enterprise Authority (LEA).

(a)(i) Describe the advantages of being a member of farming co-operative. - The way in which government can help entrepreneurs is through provision of financial
assistance to locals, for example, National Development Bank (NDB) and Citizen
- The benefit of being a member of a farming co-operative is that of skills sharing/ Entrepreneurial Development Agency (CEDA)
members learn new skills
- The farming co-operative makes it easy for members to raise a high amount of (b)(i) Describe the characteristics of production amongst the hunting and gathering
capital/group investment societies.
- The benefit of being a member of farming co-operative creates opportunity for
division of labour/sharing of tasks - The characteristic of production amongst hunting and gathering societies is use of
- The members of a farming co-operative share ideas Simple technology/tools/labour intensive
- The benefit of being a member of farming co-operative is that of collective decision
making/ good decisions are made - The division of labour amongst hunting and gathering societies was gender, for
- The farming co-operative improves marketing of products example, women gather wild fruits and men hunt wild animals.
- The benefit of being a member of farming co-operative is that of easy access to
financial assistance from financial institutions - There was communal use of land/hunting areas among hunting and gathering
- The benefit of being a member of farming co-operative is that of sharing of a societies.
common market to reduced competition
- The members of a farming co-operative benefit from collective saving which gives - The hunting and gathering societies depended on natural resources for their
them opportunity for bigger interest rates survival.
- The benefit of being a member of farming co-operative is that of cost sharing, for - The hunting and gathering societies practised subsistence production
example, transport is shared so the cost is shared
- The members of farming co-operative benefit from bulk buying of raw materials - There was craftsmanship production/use of traditional skills amongst hunting and
which inputs makes them cheaper gathering societies.
- The benefit of being a member farming co-operative is that of poverty alleviation
- The benefit of being a member of farming co-operative is that of employment

15
creation

Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
(ii) Explain the advantages of labour intensive production. MATER SPEI COLLEGE
- The labour intensive production helps create employment to a large number of people DEVELOPMENT STUDIES
- Labour intensive production is cheap to run and maintain / little capital required since Module 2: Production, Consumption & Investment
simple technology used in making of goods and services.
Paper 2
- The advantage of labour intensive provides workers with an opportunity to train on the
job 1. Study Fig. 1, which the relationship between Multi-National Corporations (MNCs)
and developing countries.
- Labour intensive production causes less pollution / destruction of the environment
because of use of simple technology

- Labour intensive production requires little skills to enter or run due to the use of simple
technology.

- Labour intensive production promotes human interaction due to the use of simple
technology.

- Labour intensive production encourages craftsmanship because of the use of simple

technology.

- Labour intensive production uses local skills and knowledge because of the use of
simple technology.
Fig. 1

(a)(i) Explain how Multi-National Corporations benefit host countries.

- The multi-national corporations benefit host countries by pay tax to the

government.
- The multi-national corporations increase employment opportunities. (Benefit to the
people)
- The multi-national corporations bring new technology to the host countries.
(Technical knowhow)
- The multi-national corporations bring in foreign currency when they export from
the host country. (International trade)
- The multi-national corporations enjoy greater economies of scale.
- The multi-national corporations give support, mostly financial to the local social
clubs and associations. (Money)
- The multi-national corporations offer goods and services of better quality and
variety to customers.
The multi-national corporations widen the country’s income base increasing Gross

16
-
National Products.

Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
(ii) Describe the problems that Multi-National Corporations cause to developing - The possible problem that the localisation process may cause in Botswana is shortage
countries. of skilled locals

- The problem that multi-national corporations cause on developing countries is that - The localisation process in Botswana may cause problem of poor work ethics among
at times dominate economies by monopolistic practices. citizens
- The multi-national corporations sometimes bring in their own experts instead of
training locals for managerial positions within the host country. - The problem that the localisation process in Botswana may cause is of shortage of funds
- The problem caused by multi-national corporations on developing countries is of to implement the policy.
attracting experts/skilled locals to work for them at the expense of local industries.
- The multi-national corporations encourage dependency and neo-colonialism - The problem caused by localisation process in Botswana is of lengthy training
through dependence on foreign technology. programmes that may delay the process, for example, medical doctors.
- The problem caused by Multi-national Corporation on developing countries is that
taking all the profits back to the country of their origin. - The localisation process in Botswana may be hindered by brain drain whereby trained
- The multi-national corporations sometimes interfere with the policies of the host locals prefer to work in developed countries rather than at home.
country.
- Some of Multi-national Corporation are too powerful for the host country to - The possible problem faced by localisation in Botswana is lack of experience among
control. locals slows down production, for example, when a fresh local graduate replaces an
Localisation is the act of replacing foreign workers with nationals. experienced expatriate graduate.

(b) (i) Explain why localisation is necessary in Botswana. - The localisation policy creates conflict between home government and other
governments/ it strains foreign relations/ promotes xenophobia.
- The reason localisation is necessary in Botswana because it helps to promote the socio-
economic development of locals

- Localisation is part of restoring national pride and asserting a country’s independence

- Localisation is necessary in Botswana because it helps in making Batswana believe in

themselves and not always show too much respect for foreigners

- Localisation is necessary in Botswana as citizens would occupy politically sensitive

positions
- Localisation creates employment for citizens

- Development is in accordance to culture

- There is possibility of making long term decisions as there is no fear of end of contract
- Locals acquire necessary skills
- Workers are patriotic and have their national interest at heart
- Saves money wasted on foreigners

17
(ii) Suggest possible problems that the localisation process may cause in Botswana.

Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
 MATER SPEI COLLEGE (ii) For three of the policies shown in Fig. 2, suggest two ways by which each policy may
improve production.
DEVELOPMENT STUDIES
 Citizen Empowerment
Module 2: Production, Consumption & Investment - Citizen Empowerment policy may improve production by increasing

Paper 2 businesses as locals are given financial assistance

- The citizen empowerment policy increased production as citizens are
1 Study Fig.1, which shows some of the government policies in Botswana.
trained or become skilled
 Localisation
- The localisation policy may improve production as locals are likely to
work harder for their country or national pride
- The localisation policy may help to improve production as local
businesses are given financial assistance
 Privatisation of parastatals
- The privatisation of parastatals policy may lead to efficient use of
resources will result in high production

Fig.1 - The privatisation of parastatals policy lead to possibility of increased

foreign direct investment (FDI) to fuel production through more capital
(a)(i) Describe each policy shown in Fig.1.
or technology transfer
- Citizen empowerment is when the government equips nationals with skills and  Women and property ownership
other means so that they can participate in the economy or development of their - More women owned businesses will increase production in the economy
country - Increased production in women inclined industries, for example, Fashion
- Localisation is when the government replaces foreign workers with nationals or and Design, Interior design, Beauty Parlours, Knitting and pottery
citizens. - Inherited funds can be used as capital for investment
- Privatisation of parastatals is when the government transfers ownership of its - Government allows females or women to own big or large possessions
businesses to individuals and companies usually through selling. or assets/material/goods
- Women and property ownership is when the government allows women to own
big possessions, for example houses and farms [Accept any two correct points per policy]

18
[RULE: Do not penalise for repetition of terms]

Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
(b)(i) Describe ways by which the government of Botswana empowers citizens. MATER SPEI COLLEGE
- The way by which the government of Botswana empowers citizens is through training DEVELOPMENT STUDIES
or educating citizens
- The government of Botswana empowers citizens through provision of financial Module 2: Production, Consumption & Investment
assistance to locals
- The citizens are empowered by government through providing them with opportunity Paper 2
to vote in elections
- The government of Botswana empowers its citizens through provision of information
using radio, television, newspapers on various issues
- The way by which government of Botswana empowers its citizens is through provision
of health services to fight/ cure/control/treat diseases
- The government of Botswana empowers locals by teaching them their rights
- The government is providing a market to citizens or tenders as a way of empowering
them.
- The government of Botswana helps with marketing of local goods and services to
outside markets
- The government empowers its citizens by reserving some of businesses for them.

(ii) Suggest challenges that the government may face when trying to follow the
localisation policy.

- The challenge that the government may face when trying to follow the localisation
policy is of shortage of skilled locals

- The poor work ethics among citizens can lead to a challenge faced by government when
trying to follow localisation policy.

- The government may face challenges of shortage of funds to implement the

localisation policy (a)(i) Describe each type of production shown in Fig. 1.
- The challenge that the government may face when trying to follow the localisation
policy is lengthy training programmes that may delay the process, for example, medical - Primary production is the extraction of raw materials from the environment without
doctors changing their form
- The government may face challenges of Brain drain when trying to implement
localisation policy. - Secondary production is the changing of raw materials into semi-finished and
- The challenge that the government may face when trying to follow the localisation finished products/goods
policy is lack of experience among locals slows down production, for example, when
a fresh local graduate replaces an experienced expatriate graduate - Tertiary production deals with provision of services to support production [Allow
examples]
- The localisation policy creates conflict between home government and other
governments/ it strains foreign relations/ promotes xenophobia. - Quaternary is the activities concerned with research, compilation, processing and
dissemination of the research information to improve human resources/

19
production.

Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
(ii) Suggest ways the productivity of the secondary sector could be improved in (b)(i) Describe ways by which Botswana has benefited from primary production.
Botswana.
- The way by which Botswana has benefited from primary production is through
- The way productivity of the secondary sector could be improved in Botswana is employment creation/improved standard of living of workers
through training workers or entrepreneurs, for example, Local Enterprise Authority
(LEA) - The benefit of Botswana from primary production is that of earning foreign
exchange from export of raw materials such as diamonds, cooper, nickel and soda
- The secondary sector productivity could be improved through importation of raw ash
materials
- The way by which Botswana has benefited from primary production is through
- The productivity of secondary sector could be improved through provision of infrastructural development, for example, tarred roads, improved
cheaper utilities ,for example, water and electricity telecommunication network such as internet.

- The secondary sector productivity could be improved by provision of funding or - The benefit of Botswana from primary production is that of being famous for beef
loans at low interest rate, for example, through Citizen Entrepreneurial production and diamond mining
Development Agency (CEDA) and National Development Bank (NDB)
- The primary production has benefited Botswana through stimulation of industrial
growth, for example, meat processing and diamond polishing.
- The secondary sector could be improved by provision of serviced land or
infrastructure, for example, availability of water, tarred roads, telecommunication - The way by which Botswana has benefited from primary production is through
network and electricity Food from production.

- The secondary sector could be improved by reduction of bureaucratic process or - The way by which Botswana has benefited from primary production is through
delay in decision making or red tape. Acquisition of skills through training.

- The way by which Botswana has benefited from primary production is through
- The productivity of secondary sector could be improved by use of improved or Technological advancement.
better technology
- The primary production is source of income for Botswana.
- The secondary sector productivity could be improved by inviting foreign
investors/Multi-National Companies (MNCs) - The way by which Botswana has benefited from primary production is through
increased GDP/GNP/GNP per capita

- The productivity of secondary sector could be improved through marketing/

finding market for locally produced goods

- The secondary sector productivity could be improved through use of import

substitution strategy and export oriented strategy

20
Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
 MATER SPEI COLLEGE

DEVELOPMENT STUDIES
(ii) Explain why investing in livestock farming in Botswana may be risky.
Module 2: Production, Consumption & Investment
- The risk of investing in livestock farming in Botswana is that meat or beef prices
can fail easily. Paper 2

- The Livestock farming is risky in Botswana because livestock can be attacked by

diseases, for example, foot and mouth.

- The investing in livestock farming is risky in Botswana as livestock can be attacked

by pests, for example, tsetse fly.

- The risk of investing in livestock farming is that of drought which can result in
death of many animals.

- The drought can reduce the quality of meat (grade/value) which make it risky to
invest in livestock farming in Botswana.

- The risk of investing in livestock farming in Botswana is that of other livestock

producers that can bring too much competition.

- The risk of investing in livestock farming in Botswana is that of demands by

importers , for example, European Union (EU) market can make sales difficult with (a)(i) Using Fig. 1 only, describe the employment trend for each of the sectors of
their terms and conditions production shown in the post-industrial stage.

- The primary sector employment is decreasing /falling/dropping/slow

- The secondary sector employment is decreasing/falling/dropping
- The tertiary sector employment is increasing
- The quaternary sector employment is increasing/rising/fast

(ii) Describe the benefits of a growing tertiary industry.

- The benefit of a growing tertiary industry is increased market

- The tertiary industry growth benefit is that of greater opportunities for new
business/diversification
- The growth of tertiary industry helps with job creation
- The benefit of a growing tertiary industry is infrastructural development, for
example, telecommunication networks and tarred roads.
- The tax earning by government is a benefit of a growing tertiary industry.

21
- The growing tertiary industry will help a country to earn foreign exchange
- The skills development is a benefit of a growing tertiary industry.

Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
 - The benefit of growing tertiary industry will help a country to have technological MATER SPEI COLLEGE
advancement
- The growth of tertiary industry will help with improvement in production DEVELOPMENT STUDIES
- The benefit of a growing tertiary industry will help to reduce imports
Module 2: Production, Consumption & Investment

(b)(i) Describe the social characteristics of Newly Industrialising Countries (NICs) Class Exercise 25: Marking Scheme

- The social characteristic of Newly Industrialised Countries is that of decreasing 1 (a) (i) What are the advantages of developing the secondary sector in Botswana?
morbidity rate.
- The Newly Industrialised Countries have increasing literacy rate. - The advantage of developing secondary sector in Botswana is that it will help to
- The social characteristic of Newly Industrialised Countries is that of decreasing create employment.
Death Rate. - The developing of secondary sector in Botswana will with technological
- The social characteristic of Newly Industrialised Countries is that of decreasing advancement/ bring new technology.
Birth Rate. - The development of secondary sector in Botswana will increase GDP/GNP/GNP
- The Newly Industrialised Countries have decreasing Infant Mortality Rate. per capita of the country.
- The social characteristic of Newly Industrialised Countries is that of increasing - The developing of secondary sector will help Botswana earn foreign exchange.
urban population/urbanisation. - The advantage of developing secondary sector in Botswana helps with having
- The Newly Industrialised Countries have lower teacher-pupil ratio. variety of goods and services locally.
- The social characteristic of Newly Industrialised Countries is that of increasing - Promote economic linkages (Economic linkages is when industries that produce
calorie intake goods and services depend on each other )
- The Newly Industrialised Countries have improved health facilities. - Value added products produced/ semi-finished and finished goods will be
- The social characteristic of Newly Industrialised Countries is that of lower-doctor produced/ goods that are ready for use
patient rate - Increased returns/ helps to maximise profit by selling finished goods
- Control of the prices
(ii) Explain the importance of land in the industrialisation process. - Stability in prices & demand enjoyed
(ii) Explain why countries of the south still export mainly primary product
- The importance of land in the industrialisation process is that space or area is
- The countries of the south still export mainly primary product due to unfair trade
needed for building factories or factory site.
patterns/ countries of the South are viewed as a source of raw materials
- The part of land surface is used for construction of infrastructure, for example, - They are seen as market for manufactured goods/Neo-colonialism
- The countries of the south still export mainly primary product due to lack of
roads, railway lines.
technological capacity/machines
- The natural resources from land are used as raw materials in factories. - The countries of the south still export mainly primary product due to lack of
capital/debts
- The farmers grow crops on land which are used as raw materials in factories.
- The countries of the south still export mainly primary product due to lack of
- The water is used to cooling and cleaning machines in industries. industrial skills/ training
- They suffer from rigidity/unwillingness to accept and effect change
- The land in industrialisation process can be used as security or collateral to obtain
- The countries of the south still export mainly primary product due to principle of
loan for financial institution, for example, Banks. comparative advantage
- The land can be used to provide capital for production through rental or leasing.

22
Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment
(b)(i) Describe the problems faced by investors in Botswana. (ii) Describe ways in which the government can encourage the development of local
entrepreneurship.
- The problem faced by investors in Botswana is that of having small market to sell
their goods and services. - The government can encourage the development of local entrepreneurship through
credit schemes/ facilities/ loans/grants/financial assistance, for example, Citizen
- The investors in Botswana will face problem of having few skilled manpower Entrepreneurial Development Agency (CEDA)
which can lead to low production.
- The government can encourage the development of local entrepreneurship through
- The problem faced by investors in Botswana is that of poor infrastructure, for training in business skills, for example, Local Enterprise Authority
example, poor telecommunication network and roads.
- The government can encourage the development of local entrepreneurship through
- The investors in Botswana may face problem of lack of raw materials to produce provision of infrastructure/serviced plots, for example, plots with tarred roads,
goods. water, telecommunication networks and electricity

- The problem faced by investors in Botswana is that of expensive utilities such as - The government can encourage the development of local entrepreneurship through
water and electricity bills. marketing of local products, for example, Botswana Export Development
Investment Agency (BEDIA)/buy local products campaign

- The government can encourage the development of local entrepreneurship through

reserving some businesses for locals/citizens only, for example, transportation
industry such as taxies and buses and saloons

- The government can encourage the development of local entrepreneurship through

Tax holidays/rebates/tax lowering ( Tax holiday is when newly established
businesses are exempted from paying tax for a certain period of time)

- The government can encourage the development of local entrepreneurship through

government subsidy

- The government can encourage the development of local entrepreneurship through

lowering inflation [reducing prices of goods and services]

- The government can encourage the development of local entrepreneurship through

affordable utilities, for example, water and electricity

- The government can encourage the development of local entrepreneurship through

political stability

- Privatization [which is the transfer of public assets to individuals and companies

usually through selling]

23
Mater Spei College Development Studies Paper two Questions MODULE 2: Production, consumption & Investment