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Economic and management sciences

Grade 9

The economic cycle

Module 4

The foreign sector in the economic cycle

Assessment standard 1.2:foreign sector in the economic cycle

UPON COMPLETING THIS SECTION YOU WILL BE ABLE TO INDICATE THE ROLE OF THE FOREIGN SECTOR IN THE ECONOMIC CYCLE.

Up to now we have assumed that all economic activities of a country occur solely within its borders. However, with present-day technological developments in the field of communication and transport, as well as the benefits that arise from the use of large-scale production, we find that product markets are exploited not only domestically, but also internationally. Consider in this regard South Africa’s export trade in coal and other minerals, as well as agricultural products such as wine, sugar and wool, and also the imports of technological products and machinery that are imported from foreign countries.

The aim of international trade as explained in the previous paragraph, is mainly to satisfy the needs of the citizens of the country more effectively. In this way, a country can reach a stage where it is no longer dependent solely on its own resources / production, but where it can also utilise other countries’ products. That means, for example, that we in South Africa can now import sophisticated computers, while there are other countries that will want to purchase iron ore and gold from South Africa.

This international trade between countries has two components, namely:

  • The flow of goods and services that are dispatched and received (also known as international trade); and
  • The mutual payment for these goods and services in the monetary unit of each country (also known as currency transactions).
  • International trade takes place because:
  • certain countries have an excess of certain resources; for instance, South Africa has an abundance of gold and other minerals that can be exported, while there are no natural oil resources;
  • climatic conditions vary from country to country. As a result of the erratic rainfall in South Africa there are certain agricultural products that cannot be cultivated here, and that have to be imported, for example coffee;
  • the level of technological development varies; for instance, the Japanese are renowned for their expertise in computer technology;
  • transport and communication have improved drastically. For example, fresh flowers from South Africa are supplied to markets throughout Europe on a daily basis.

Activity 1:

Foreign sector

SELF:

Draw your own version of the economic cycle (that includes the foreign sector) so that both the participants and the flow are evident. Insert the diagram on a separate sheet.

Activity 2:

Reasons for foreign trade

GROUP:

Refer to the reasons for foreign trade supplied below, and in each case give examples that could explain the South African situation.

REASON RSA EXAMPLES
  1. Availability of resources:
  1. Differing climatic conditions:
  1. Level of technology:
  1. Transport and communication:

The inclusion of the foreign sector as the fourth participant in the economic cycle is also linked by way of two streams, namely the goods stream and the monetary stream , as explained above. The inclusion of the foreign sector has resulted in the fact that the economy is no longer “closed”, but that it has become more “open”, because imports and exports have caused “more” goods and money to flow into / flow out of the two streams as indicated earlier.

Activity 3:

Foreign trade

SELF / GROUP:

Make a list of goods that are exported from and imported to South Africa. Indicate, as far as possible, where the goods are exported to and from where these goods are imported.

RSA EXPORTS AND ITS DESTINATION RSA IMPORTS AND ITS ORIGIN

Activity 4:

Foreign trade

SELF/GROUP:

Name the monetary unit of each country that has been listed in the table below:

COUNTRY MONETARY UNIT
  1. Japan
  1. Russia
  1. USA
  1. Britain
  1. Botswana
  1. India
  1. Germany
8. France

Activity 5:

Graph of foreign exchange

GROUP:

On every Wednesday for at least eight weeks, indicate what the exchange rate is between the South African Rand and the following monetary units: (Divide the class into four groups for this purpose.)

Week: (Group 1)Rand/USA Dollar (Group 2)Rand/Euro (Group 3)Rand/Pound (Group 4)Rand/Pula
1.
2.
3.
4.
5.
6.
7.
8.

GROUP:

At the end of the eight weeks each group must indicate their findings on a graph and then explain to the rest of the class what tendency prevailed in the course of the eight weeks.

Assessment

Learning Outcomes(LUs)

LO 1

the economic cycle

The learner will be able to demonstrate knowledge and understanding of the economic cycle within the context of “the economic problem.”

Assessment Standards(ASs)

We know this when the learner:

1.5 explains the different flows of money, factors of production, goods and services in the economic cycle within the South African economy;

1.6 discusses the role of the foreign sector in the economic cycle;

1.7 illustrates by means of a graph and discusses how demand and supply influence prices;

1.8 critically assesses the influence and actions (strikes and stayaways) of trade unions in general and during the apartheid era on:

the South African economy;

political, economic and social transformation;

labour issues;

1.9 discusses the effect of the national budget on the economy (e.g. taxation and expenditure on education, social welfare, health and security.)

Memorandum

ACTIVITY 2: Reasons for foreign trade

Provide reasons for foreign trade

Availability of resources: The RSA has a variety of minerals, but no natural oil.

Differing climatic conditions: The RSA produces maize, oranges, etc, but no coffee, rubber.

Level of technology: The RSA has to import watches, computers, etc.

  1. Transport and communication: RSA has good transport and communications facilities.

ACTIVITY 3: Foreign trade

List of goods that are imported and exported.

EXPORTS IMPORTS
Maize (African countries) Computers (USA)
Wine (Europe) Watches (Switzerland)
Iron ore (Japan) Cars (Japan)

ACTIVITY 4: Foreign exchange (means of payment)

Provide the monetary unit of the following countries

JAPAN: yen

RUSSIA: rouble

USA: dollar

BRITTAIN: pound sterling

BOTSWANA: pula

INDIA: rupee

ACTIVITY 5: Graph illustrating foreign exchange

Collect data relating to rates of exchange and draw the graph with the help of the information obtained.

Questions & Answers

can someone help me with some logarithmic and exponential equations.
Jeffrey Reply
sure. what is your question?
ninjadapaul
20/(×-6^2)
Salomon
okay, so you have 6 raised to the power of 2. what is that part of your answer
ninjadapaul
I don't understand what the A with approx sign and the boxed x mean
ninjadapaul
it think it's written 20/(X-6)^2 so it's 20 divided by X-6 squared
Salomon
I'm not sure why it wrote it the other way
Salomon
I got X =-6
Salomon
ok. so take the square root of both sides, now you have plus or minus the square root of 20= x-6
ninjadapaul
oops. ignore that.
ninjadapaul
so you not have an equal sign anywhere in the original equation?
ninjadapaul
Commplementary angles
Idrissa Reply
hello
Sherica
im all ears I need to learn
Sherica
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Tamia
what is a good calculator for all algebra; would a Casio fx 260 work with all algebra equations? please name the cheapest, thanks.
Kevin Reply
a perfect square v²+2v+_
Dearan Reply
kkk nice
Abdirahman Reply
algebra 2 Inequalities:If equation 2 = 0 it is an open set?
Kim Reply
or infinite solutions?
Kim
The answer is neither. The function, 2 = 0 cannot exist. Hence, the function is undefined.
Al
y=10×
Embra Reply
if |A| not equal to 0 and order of A is n prove that adj (adj A = |A|
Nancy Reply
rolling four fair dice and getting an even number an all four dice
ramon Reply
Kristine 2*2*2=8
Bridget Reply
Differences Between Laspeyres and Paasche Indices
Emedobi Reply
No. 7x -4y is simplified from 4x + (3y + 3x) -7y
Mary Reply
is it 3×y ?
Joan Reply
J, combine like terms 7x-4y
Bridget Reply
im not good at math so would this help me
Rachael Reply
yes
Asali
I'm not good at math so would you help me
Samantha
what is the problem that i will help you to self with?
Asali
how do you translate this in Algebraic Expressions
linda Reply
Need to simplify the expresin. 3/7 (x+y)-1/7 (x-1)=
Crystal Reply
. After 3 months on a diet, Lisa had lost 12% of her original weight. She lost 21 pounds. What was Lisa's original weight?
Chris Reply
what's the easiest and fastest way to the synthesize AgNP?
Damian Reply
China
Cied
types of nano material
abeetha Reply
I start with an easy one. carbon nanotubes woven into a long filament like a string
Porter
many many of nanotubes
Porter
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Yasmin
what is the function of carbon nanotubes?
Cesar
what is nanomaterials​ and their applications of sensors.
Ramkumar Reply
what is nano technology
Sravani Reply
what is system testing?
AMJAD
preparation of nanomaterial
Victor Reply
Yes, Nanotechnology has a very fast field of applications and their is always something new to do with it...
Himanshu Reply
good afternoon madam
AMJAD
what is system testing
AMJAD
what is the application of nanotechnology?
Stotaw
In this morden time nanotechnology used in many field . 1-Electronics-manufacturad IC ,RAM,MRAM,solar panel etc 2-Helth and Medical-Nanomedicine,Drug Dilivery for cancer treatment etc 3- Atomobile -MEMS, Coating on car etc. and may other field for details you can check at Google
Azam
anybody can imagine what will be happen after 100 years from now in nano tech world
Prasenjit
after 100 year this will be not nanotechnology maybe this technology name will be change . maybe aftet 100 year . we work on electron lable practically about its properties and behaviour by the different instruments
Azam
name doesn't matter , whatever it will be change... I'm taking about effect on circumstances of the microscopic world
Prasenjit
how hard could it be to apply nanotechnology against viral infections such HIV or Ebola?
Damian
silver nanoparticles could handle the job?
Damian
not now but maybe in future only AgNP maybe any other nanomaterials
Azam
can nanotechnology change the direction of the face of the world
Prasenjit Reply
At high concentrations (>0.01 M), the relation between absorptivity coefficient and absorbance is no longer linear. This is due to the electrostatic interactions between the quantum dots in close proximity. If the concentration of the solution is high, another effect that is seen is the scattering of light from the large number of quantum dots. This assumption only works at low concentrations of the analyte. Presence of stray light.
Ali Reply
the Beer law works very well for dilute solutions but fails for very high concentrations. why?
bamidele Reply
how did you get the value of 2000N.What calculations are needed to arrive at it
Smarajit Reply
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Source:  OpenStax, Economic and management sciences grade 9. OpenStax CNX. Sep 15, 2009 Download for free at http://cnx.org/content/col11074/1.1
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