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Grade 11 Economics Paper 2 June 2025

The document is an examination paper for Grade 11 Economics, Paper 2, set for June 2025. It includes instructions for answering questions, a breakdown of sections, and various questions covering microeconomics concepts. The paper is structured into compulsory and optional sections, with a total of 150 marks available over 13 pages.

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jacob molahloe
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11K views14 pages

Grade 11 Economics Paper 2 June 2025

The document is an examination paper for Grade 11 Economics, Paper 2, set for June 2025. It includes instructions for answering questions, a breakdown of sections, and various questions covering microeconomics concepts. The paper is structured into compulsory and optional sections, with a total of 150 marks available over 13 pages.

Uploaded by

jacob molahloe
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

JUNE EXAMINATION 2025

GRADE 11

ECONOMICS

PAPER 2

Examiner: TJ Molahloe
Moderator: NW Zitha
TIME: 2 hours

MARKS: 150

13 Pages
ECONOMICS 2
(PAPER 2) GRADE 11

INSTRUCTIONS AND INFORMATION

1. Answer FOUR questions as follows in the ANSWER BOOK:


SECTION A: COMPULSORY
SECTION B: Answer any TWO questions
SECTION C: Answer only ONE question
2. Answer only the required number of questions. Answers in
excess of the required number will NOT be marked.
3. Number the answers correctly according to the numbering system
used in this question paper.

4. Write the question number above each answer.

5. Read the questions carefully.

6. Start EACH question on a NEW page.

7. Leave 1 – 2 lines between subsections of questions.

8. Answer the questions in full sentences and ensure that the format, content and
context of your responses comply with the cognitive requirements of the questions.

9. Use only black or blue ink.

10. You may use a non-programmable calculator.

11. Write neatly and legibly.

SECTION A (COMPULSORY)

QUESTION 1 30 MARKS

1.1 Various options are provided as possible answers to the following questions.
Write down the question number (1.1.1 – 1.1.8), choose the answer and write the
letter (A – D) of your choice next to the question number in the ANSWER BOOK.
1.1.1 … have a complementary relationship because they are used
in conjunction with each other.
A A Smart TV and smartphone airtime
B A Stove and a gas cylinder
C Juice and full cream milk
D Apple pencil and an iPad
1.1.2 In perfect markets, not one of the producers can charge high prices as this
will result in them losing … to other producers.

A price advantage
ECONOMICS 3
B cost advantage
(PAPER 2) GRADE 11
C market share
D product share

1.1.3 In the short run, the firm will always … A


make a loss. B experience diminishing marginal returns.
C experience diminishing marginal utility.
D make a profit.
1.1.4 In SMART goals, the idea is … that goals must
be identified, understood and not merely randomly.
A specifically
B measurable
C agreed
D realistic

1.1.5 The marginal cost curve shows the business at which point the cost of using variable
inputs starts to …
A stabilise. B drop.
C rise.
D stagnate.

P.T.O.
ECONOMICS 4
(PAPER 2) GRADE 11

1.1.6 Total revenue is maximised at the point where … A marginal revenue = 0.


B total revenue = 100. C marginal costs = 100. D total costs = 0.
1.1.7 In … situation the value of price elasticity of demand is 0 and the demand
is entirely unresponsive to price change.

A a perfectly elastic
B a perfectly inelastic
C a relatively elastic
D a relatively inelastic

1.1.8 In calculating price elasticity of demand, the … is not considered.

A original price
B new price
C % change in quantity demanded
D % change in quantity supplied (8 x 2) (16)

1.2 Choose a description from COLUMN B that matches the item in COLUMN A.
Write only the letter (A – I) next to the question number (1.2.1 – 1.2.8) in the ANSWER
BOOK, for example 1.2.9 J.

COLUMN A COLUMN B

1.2.1 Price taker A Only needed for what it can produce

1.2.2 Monopoly B The period of time where at least one input


factor is fixed
1.2.3 Derived demand
C The result of many firms entering the market
1.2.4 Sale maximising for competition
D Change in demand is equal to a change in
1.2.5 Short-run price
E
1.2.6 Normal profit Demand is relatively unresponsive to
changes in price
1.2.7 Unitary elastic F
The price is high as the firm has market
1.2.8 PED < 1 > 0 power

G The point where the firm breaks even

H This always intersects AC at its lowest


possible point

I The price is determined by the forces of


supply and demand
(8 x 1) (8)
ECONOMICS 5
(PAPER 2) GRADE 11

1.3 Give ONE term for each of the following descriptions. Write only the term next to
the question number (1.3.1 – 1.3.6) in the ANSWER BOOK. Abbreviations,
acronyms and examples will NOT be accepted.

1.3.1 The price quoted for a product and a signal to buyers of what they are
expected to pay

1.3.2 The price of a good in relation to another good

1.3.3 Stays the same as output increases and is not linked to output

1.3.4 Falling average costs as the costs are divided over more units of
outputs

1.3.5 Measures the responsiveness of demand to a change in price

1.3.6 The amount of income earned from the sale of a good at a certain price
(6 x 1) (6)

TOTAL SECTION A: 30
ECONOMICS 6
(PAPER 2) GRADE 11

SECTION B
Answer any TWO questions from this section in the ANSWER BOOK.

QUESTION 2: MICROECONOMICS

2.1 Answer the following questions

2.1.1 Name any TWO revenue curves in the long-run. (2 x 1) (2)

2.1.2 What happens to the cost of goods, ceteris paribus, if the cost of
factors of production increases? (1 x 2) (2)

2.2 Study the diagram below and answer the questions that follow.

Market

Initiate the buying and selling


mechanism
Sellers
Buyers
No restrictions

Absence of direct competition


Sells product an
identical market price

[Source: [Link]

2.2.1 Identify the market structure in the diagram above. (1)

2.2.2 Name the mechanism used to determine the price in the market above. (1)

2.2.3 Briefly describe the term collusion. (2)

2.2.4 How is the presence of direct competition determined in a market? (2)

2.2.5 Why might a market be deregulated? (2 x 2) (4)

2.3 Study the cartoon below and answer the questions that follow:
ECONOMICS 7
(PAPER 2) GRADE 11

PRICING
PREDATORS

SA CONSUMER

BANK CHARGES

BREAD-
CARTEL

[Source: [Link] 23–29 November 2007]

2.3.1 Which market structure do telecommunication firms belong to? (1)

2.3.2 Name any ONE locally controlled bank in South Africa. (1)

2.3.3 Briefly describe the term heterogeneous. (2)

2.3.4 Why is the bread cartel a threat to the consumer? (2)

2.3.5 How can a South African consumer be protected from pricing predators?
(2 x 2) (4)

2.4 Discuss the nature of the product and market power as characteristics of an
oligopoly. (4 x 2) (8)

2.5 How is the knowledge of price elasticity of demand beneficial to producers? (8)
[40] QUESTION 3: MICROECONOMICS

3.1 Answer the following questions

3.1.1 Name any TWO cost curves. (2 x 1) (2)

3.1.2 How does profit maximisation occur in a firm? (1 x 2) (2)


ECONOMICS 8
(PAPER 2) GRADE 11

3.2 Study the extract below and answer the questions that follow

CAPITAL COST OF SOUTH AFRICA’S TITANIUM


BENEFICIATION PROJECT EXPECTED TO PEAK AT
R14BN
South African ilmenite used to manufacture titanium dioxide pigment in KwaZulu-
Natal is on the way to receiving a major value boost.

This is because ilmenite, a heavy minerals sands derivative, sells at around


$300/t on export markets, whereas using it to manufacture titanium
dioxide pigment at the Richards Bay Industrial Development Zone will enable it
to fetch a ten-times-higher $3 000/t.

The first thing the R14-billion Nyanza Light Metals project is trying to achieve is
to move Africa’s abundant raw materials up the value curve, Nyanza
CEO Donovan Chimhandamba emphasised to Engineering News & Mining
Weekly in a Zoom interview.

Nyanza is putting together a project for 80 000 t/y of titanium dioxide pigment,
which is probably around half of Africa's capacity and just over 1% in
terms of the global market.
[Source: Extract from [Link] africas-titanium-
beneficiation-project-expected-to-peak-at-r14bn-2023-06-28]

3.2.1 Which mineral is referred to in the extract above? (1)

3.2.2 Name the type of cost under which the capital cost referred to in the
extract above is classified. (1)

3.2.3 Briefly describe the term marginal revenue. (2)

3.2.4 Why are firms limited in the short run? (2)

3.2.5 Why is the cost of R14-billion titanium beneficiation worth it for South
Africa? (2 x 2) (4)

3.3 Study the graph below and answer the questions that follow.
ECONOMICS 9
(PAPER 2) GRADE 11

LONG RUN COSTS

A B

The points of minimum efficient scale

3.3.1 Give the abbreviation ATC in the graph above in full. (1)

3.3.2 Identify the trend of ATC between ‘A’ and ‘B’ in the graph above. (1)

3.3.3 Briefly describe the term scale of production. (2)

3.3.4 What do economies of scale in S-ATC1 and S-ATC2 in the graph above
imply? (2)

3.3.5 Why does a firm reach diseconomies of scale? (2 x 2) (4)

3.4 Discuss explicit and implicit costs as they are used by accountants and
economists. (4 x 2) (8)

3.5 Analyse survival as an objective of a business. (8)


[40] QUESTION 4: MICROECONOMICS

4.1 Answer the following questions.

4.1.1 Name any TWO formulas for calculating different kinds of revenues in
a firm. (2 x 1) (2)

4.1.2 Why is the quantity demanded of habit-forming articles, price inelastic?


(1 x 2) (2)

4.2 Study the graph below and answer the questions that follow.
ECONOMICS 10
(PAPER 2) GRADE 11

The effects of price policies on cigarette consumption in South Africa


Rand, constant 2016 prices
(

pack of 20 Cigarette consumption


millions of packs
(
Real price per
)

Real price of cigarettes Consumption of cigarettes

[Source: [Link]
cigarette-nconsumption-in-South-Africa,123424,0,[Link]]

4.2.1 Identify the peak year of cigarette consumption in the graph above. (1)

4.2.2 At what price was the consumption of cigarettes at its lowest according
to the graph above? (1)

4.2.3 Briefly describe the term Real Price. (2)

4.2.4 Why does the consumption of cigarettes increase? (2)

4.2.5 How could consumers of cigarettes improve their elasticity despite the
price of the cigarettes? (2 x 2) (4)

4.3 Study the extract below and answer the questions that follow.

SMART GOALS AREN’T NECESSARILY WISE.

In 1981, consultant George Doran developed a framework called SMART goals –


which stands for … At the time when the SMART goal system was developed,
there were many benefits—namely, the formality of setting and writing down
goals. However, the workplace has evolved significantly since 1981. And yet,
many organisations and leaders still rely on this system today.
ECONOMICS 11
(PAPER 2) GRADE 11

I am a leadership consultant, and time and time again I have found that today,
SMART goals can, in fact, sabotage your success at work. With SMART goals,
the primary focus is on outcomes, without accounting for the journey. Further,
the framework can cloud what you want your team to accomplish. Even more
importantly, it’s valuable to include learning, growth, and collaboration goals,
which can be challenging to account for with the SMART goal system.
[Source: [Link] success-at-
work-heres-what-to-do-instead]

4.3.1 What does SMART in the extract above stand for? (1)

4.3.2 Identify any ONE negative factor of SMART goals in the extract above. (1)

4.3.3 Briefly describe the term stakeholders. (2)

4.3.4 Why are SMART goals important for a business? (2)

4.3.5 How are governments and environmentalists interested in a business?


(2 x 2) (4)

4.4 Distinguish between perfectly elastic supply and perfectly inelastic supply.
(4 x 2) (8)

4.5 Analyse the benefits of producers if they produce at a level that allows them to
experience economies of scale. (8)
[40]

TOTAL SECTION B: 80

SECTION C
Answer ONE of the two questions from this section in the ANSWER BOOK.

Your answer will be assessed as follows:

MARK
STRUCTURE OF ESSAY
ALLOCATION
Introduction
The introduction is a lower-order response.
• A good starting point would be to define the main concept
related to the question topic.
Max. 2
• Do not include any part of the question in your introduction.
• Do not repeat any part of the introduction in the body.
• Avoid mentioning in the introduction what you are going to
discuss in the body.
ECONOMICS 12
(PAPER 2) GRADE 11

Body Max. 26
Main part: Discuss in detail/In-depth discussion/Examine/
Critically discuss/Analyse/Compare/Evaluate/Distinguish/
Differentiate/Explain/Draw a graph and explain/Use the graph
given and explain/Complete the given graph/Assess/Debate A
maximum of 8 marks may be allocated for headings/
examples.

Additional part: Critically discuss/Evaluate/Critically evaluate/


Debate/ Deduce/Compare/Distinguish/Interpret/How?/Suggest A
Max. 10
maximum of 2 marks may be allocated for a mere listing
facts.
Conclusion
Any higher-order conclusion should include:
• A brief summary of what has been discussed without repeating
facts already mentioned.
• Any opinion or value judgement on the facts discussed. Max. 2
• Additional support information to strengthen the discussion/
analysis
• A contradictory viewpoint with motivation, if required •
Recommendations
TOTAL 40
ECONOMICS 13
(PAPER 2) GRADE 11
QUESTION 5: MICROECONOMICS 40 MARKS 40 MINUTES

• Discuss in detail the demand and supply relationships with the aid of graphs.
(26 marks)
• Why is the factor market necessary in the economy? (10 marks) 40

QUESTION 6: MICROECONOMICS 40 MARKS 40 MINUTES

• Discuss the price elasticity of demand (PED) without the aid of graphs.
(26 marks)
• How does brand loyalty and habit formation impact on demand elasticity?
(10 marks) 40

TOTAL SECTION C: 40

TOTAL: 150
END

Common questions

Powered by AI

SMART goals are specific, measurable, attainable, relevant, and time-bound objectives used predominantly for setting clear and actionable targets. However, they can potentially sabotage a team's success by overly focusing on short-term outcomes without considering the importance of the process and journey. This rigid framework may ignore the need for adaptability, learning, and growth, which are critical in a dynamic work environment. Additionally, an overemphasis on set targets can narrow a team's focus, potentially overlooking broader organizational goals and collaborative efforts .

In an oligopoly, the nature of the product can be either homogeneous or differentiated, which gives firms the ability to exert market power. This market power allows firms to influence prices because there are only a few dominant sellers. Additionally, the interdependence among firms leads them to consider competitors' actions when making decisions, further enhancing their market power and leading to strategic planning such as non-price competition and advertising .

The factor market plays a crucial role in the economy by facilitating the exchange of services of factors of production like labor, capital, and land. It is necessary as it determines the income distribution among the factors of production and supports production processes by allocating the necessary resources efficiently. Without a well-functioning factor market, producers would face challenges in acquiring the inputs needed for production, leading to inefficiencies and reduced output in the economy .

A bread cartel poses a threat to consumers by artificially inflating prices, reducing choice, and exploiting their dependency on staple food items. Consumers end up paying more for basic needs without any corresponding increase in quality. To protect consumers, governments can enforce anti-trust laws and regulations that deter collusion and price-fixing among firms. Consumer protection agencies can also be empowered to monitor and report unfair market practices, ensuring transparency and competitiveness in pricing .

Brand loyalty and habit formation generally decrease the elasticity of demand, making it more inelastic. When consumers are brand loyal, they are less sensitive to price changes because they prefer the brand they trust or are accustomed to, which reduces their responsiveness to price increases. Similarly, habit-forming goods, like cigarettes, result in consumers continuing to buy the product despite price hikes, as their consumption becomes a routine or necessity. This reduced sensitivity to price changes impacts producers' pricing strategies as they can afford to increase prices without significantly affecting demand .

Perfectly elastic supply implies that the slightest change in price leads to an infinite change in quantity supplied, whereas perfectly inelastic supply means that the quantity supplied remains constant regardless of price changes. In a perfectly elastic supply scenario, suppliers can adjust their output levels instantaneously in response to price changes. Conversely, in perfectly inelastic supply, the quantity available in the market does not respond to price fluctuations, often due to constraints in production capacity or fixed supply .

A firm might reach diseconomies of scale when it becomes too large, leading to inefficiencies such as coordination difficulties, increased bureaucratic costs, and managerial challenges. Communication may become less effective, and flexibility may decrease, leading to slower decision-making processes. Firms can address diseconomies of scale by implementing decentralized decision-making, improving management practices, using technology to streamline operations, and focusing on core competencies to maintain oversight and efficiency .

A market might be deregulated to increase competition, reduce prices, and enhance efficiency by removing governmental controls and barriers to entry. The impacts of deregulation can include lower prices, improved quality of goods and services, and more innovation. Deregulation can also lead to increased efficiency as firms optimize operations to compete successfully. However, it may result in job losses due to cost-cutting measures, and sometimes lead to market failures if not balanced with appropriate regulatory oversight .

Understanding price elasticity of demand is crucial for producers as it helps them set pricing strategies that optimize revenue. Producers can use this knowledge to predict how changes in their product prices might affect demand and sales volume. By identifying whether their product is elastic or inelastic, they can increase or decrease prices to maximize profit or market share. For elastic products, a price decrease might lead to a proportionately larger increase in quantity demanded, boosting revenue, while for inelastic products, producers might increase price with minimal impact on demand, raising revenue .

Producers benefit from economies of scale by reducing average costs as production increases, allowing them to offer competitive prices, increase their market share, and raise profitability. Producing at an economy of scale implies operating at a level where the cost per unit of output decreases as the scale of production increases. This typically involves investing in better technology, optimizing resource allocation, and increasing production volume to spread fixed costs over a larger number of goods, thus efficiently maximizing resources .

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