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4.1 Answer the following questions - English General - NSC Economics - Question 4 - 2023 - Paper 2
Question 4
4.1 Answer the following questions. 4.1.1 Name any TWO redress methods used to redistribute wealth. 4.1.2 Why do markets fail (find it difficult) to sustain the en... show full transcript
Worked Solution & Example Answer:4.1 Answer the following questions - English General - NSC Economics - Question 4 - 2023 - Paper 2
Step 1
4.1.1 Name any TWO redress methods used to redistribute wealth.
Answer
Two common redress methods used to redistribute wealth include:
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Affirmative Action: This policy is designed to improve opportunities for historically marginalized groups in various sectors, such as education and employment.
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Social Grants: These are benefits provided by the government to assist individuals or families in need, helping to alleviate poverty and promote social welfare.
Step 2
4.1.2 Why do markets fail (find it difficult) to sustain the environment?
Answer
Markets fail to sustain the environment primarily due to externalities, which are costs or benefits of economic activities not reflected in market prices. In environmental contexts, negative externalities like pollution mean that the true costs of production are not borne by producers, leading to over-exploitation of resources and degradation of the environment.
Step 3
4.2.1 Identify in the information above a project that has the most benefits.
Step 4
4.2.2 Name any ONE possible social benefit of building a bridge.
Step 5
4.2.3 Briefly describe the term social cost.
Answer
Social cost refers to the total cost to society resulting from an economic activity, including both private costs incurred by businesses and external costs imposed on third parties, such as environmental damage.
Step 6
4.2.4 Why should the government conduct a cost-benefit analysis before starting a new project?
Answer
The government should conduct a cost-benefit analysis to evaluate the feasibility of a project by comparing the expected costs against the anticipated benefits, ensuring that resources are allocated efficiently and effectively, and that the project will provide net positive outcomes for society.
Step 7
4.2.5 Determine which project is most beneficial by calculating the cost-benefit ratio for Project B. Show ALL calculations.
Answer
To determine the cost-benefit ratio for Project B:
- Economic Costs = R15,000
- Economic Benefits = R13,000
Cost-Benefit Ratio (CBR) for Project B:
CBR = rac{Economic\,Benefits}{Economic\,Costs} = \frac{13,000}{15,000} = 0.87 : 1
Thus, the cost-benefit ratio for Project B is 0.87:1, indicating that the costs exceed the benefits, making it less beneficial than Project A.