Term 2

week 1-3:Dynamic of markets

Market-Any organisation or mechanism that brings buyers and

sellers together.

Physical market-Physical places where buyers buy goods and

services . e.g. shops and hotel.

Other market-There are other market where buyers and sellers

never meet face to face but communicate with one another by
means of the telephone, email, the internet or the postal service

What happens on a markets

Buyers and sellers negotiate with one another about the price of
the goods and services and the quantity that will be bought.
Place where goods and services are exchanged

Dynamic of markets cont

VALUE, PRICE AND UTILITY

Value-How much something is worth in terms of money or other goods for which it
can be exchanged; the rate (price) at which goods can be exchanged.

Price-The amount of money that the buyers pay for a product and sellers
receive for sale of their product. It is the same as value of exchange

UTILITY- the satisfaction gained from consuming or using goods or services. It

represents how much satisfaction people get when they use the good and
service.

Characteristics of utility

Utility varies from person to person because of taste and preference differ,
people get different amounts of satisfaction from same goods.

Utility does not mean usefulness. Goods and services that have utility can be
useful (can opener) or useless (cigarettes)

Utility Gained from a product can changed. Peoples taste and preferences
change over time, between season, and also form place to place.

Total and marginal utility

Total utility is the total amount of satisfaction that is gained from

all the units of the good consumed.

Marginal utility is the extra satisfaction gained by consuming one

additional unit of the good.

Total and marginal utility

Buyers

Buyers are people who buy goods and services, usually for
money, to satisfy their needs and services

Sellers

Sellers are those people or institutions who supply goods and

services that satisfy buyers need and wants

Kinds of markets
Perfect market

Is a theoretical market where perfect competition exists. Many sellers compete to

Condition of a perfect market

Many buyers and sellers- no individual customer or producer can influence the price
by changing the supply or the demand for the goods, goods are identical to one
another so there is no reason to go to different producers to buy goods

Buyers have complete knowledge of the market as they know exactly what each
seller is offering and their prices.

No barriers to entry into the market

Imperfectly competitive market is a market is a market where perfect competition

does not exist and there are few sellers selling a differentiated product

Monopoly is the most extreme type of imperfect market where there is only one
producer(seller) of a good or services.

week 7-8:Public sector

Composition of public sectors

Central government including parliament and government departments

Nine provincial government including provincial parliaments and government

departments

Local government which includes metropolitan areas and local municipalities

Government owned expenses called public corporations (parastatals)such as Eskom

and Transnet

Reasons for public sector involvement in the economy

Improve the level of welfare

Supply essential services

To create fair competition

Manage strategic industries

Methods of public sector involvement

METHODS OF PUBLIC SECTOR

INVOLVEMENT

Indirect tax

Taxes are compulsory payments made by the

people and the
businesses of a country to the state. Direct taxes are taxes on the
income of individuals and profits of businesses (income taxes). Indirect
taxes are taxes on the consumption of goods and services (expenditure
taxes)types of indirect tax

Value added tax

Excise duty including excise levies

Transfer duties

Customs duties

value added tax is the main indirect tax in south Africa. It is charged at
the basic of 14% on the price of most goods and services.

Excise duties

Is a tax levied on the consumption of particular

goods

Transfer duty is paid by individuals and

businesses when they buy fixed property. It is
charged at the rate of 0% and 8% depending on
the value of the property

Customs duties or import duty

Customs duty s added to the price of imported

goods and is usually calculated as a percentage
of the value of the goods.

ECONOMIC GROWTH, DEVELOPMENT AND

GLOBALISATION

Self sufficient and dependence on agriculture

A self-sufficiency economy is called a subsistence economy.

Barter, trade and the emergence of money

History of money Bartering is a system in which goods or

services are

The history of money and banking

investigating and outlining the history of money and banking in

South Africa.
history of money in South Africa: - early African
money - indigenous money - colonial money - imperial money South African money history of banking in South Africa: - early
development - private banks - imperial banks - decreasing
importance - consolidation of banking

Population & labour force

Composition of the South African population and labour force;

explanation of the factors (such as HIV/AIDS) that impact on
them. The population size: - population growth - natural growth
rate - the demographic cycle - projected growth rates - migration
The South African labour force: - age composition - labour
force numbers - unemployment - employment - geographic
distribution Note: infuse factors impacting on the population and
labour force growth and composition, for example, hiV/AiDS.

Economic issues of the day:

Unemployment

(Week 1-2)
Unemployment and the various approaches to solve the problem.
Take cognisance of the economically marginalised. The nature
of unemployment: - the numbers - unemployment rates characteristics
of South Africas
unemployment - causes
of unemployment - effects of unemployment
Approaches to
solve unemployment: - growth of production - public works
programmes - unemployment insurance Economically
marginalised groups

Labour relations, dispute resolutions and dispute resolution

mechanisms

include labour rights and conventions within the context of the

South African labour market. The labour market in the South
African context: - demand for labour - supply of labour interaction of supply and demand The objectives of the Labour
Relations Act: - self-government - majorification - consultation
Labour rights and conventions: - conventions - labour rights labour rights in South Africa - the Labour Relations Act (LRA) - the
Basic Conditions of Employment Act (BCEA) - Compensation for
Occupational for injuries and Diseases Act (COiDA)

RECONSTRUCTION OF SOUTH AFRICAN

ECONOMY AFTER 1994
HUMAN RESOURCE
Revised acts:
Skill development act 97 of 1997 as amended

aim at improving the skill of south African workforce

Provide new entrants to the labour market to gain skill.

Employment equity act 55 of 1998 as amended

Focuses on recruitment and selection

Provided employment opportunity to the designated group

previously disadvantage.

NATURAL RESOURCES
LAND

Agriculture

Mining

fishing

MINERALS AND ENERGY

Minerals and petroleum resourse development act

CAPITAL
Funding option to acquire shares in banks
Everyone have access to bank loan
Black economic empowerment
Government housing project
Every year Government allocate billions for construction of housing
projects
ENTREPRENEURSHIP
Projects implemented to foster entrepreneurship and SMMEs:
e.g Intsika enterprises promotion agency

THANK YOU