1.9 In order to cool inflation, according to the extract, the European Central Bank will make use of: (4 marks) a) Quantitative easing b) Restrictive monetary policy c) Increase government spending d) Raise taxes 1.10 Read the following extract and answer questions 1.10 and 1.11. "South Africa has banned Bain \& Company from bidding for public-sector contracts for a decade, following the lead of the UK, after the consulting firm was accused of helping government officials degrade the South African Revenue Service's (SARS) ability to probe tax evasion. 2 National treasury said in a response to queries that the ban will last for a decade and relates to the company "engaging in corrupt and fraudulent practices related to a SARS contract". The UK in August banned Bain from public contracts for three years because of allegations related to SARS. Bain was found by a judicial commission to have had ties to illegal dealings during work restructuring Sars, where senior staff were ousted and the institution's investigative capacity was gutted." The economic problem shown in the extract is that of and has the consequence of (4 marks) a) Market failure, externalities. b) Government failure, public goods being underproduced. c) Market failure, inefficient allocation of resources. d) Government failure, public goods being overproduced. 1.11 The intervention by the South African government is that of: a) Market participation. b) Regulation. c) Government spending. d) Public provision of goods and services. 1.12 Study the following diagram and answer the question that follows. (4 marks) Figure 9.1 At an income level of $2,000 billion, (4 marks) a) Consumption equals $1,500 billion. b) Saving equals $0. c) The MPC equals 0.80. d) There is dissaving. 1.9 In order to cool inflation, according to the extract, the European Central Bank will make use of: (4 marks) a) Quantitative easing b) Restrictive monetary policy c) Increase government spending d) Raise taxes 1.10 Read the following extract and answer questions 1.10 and 1.11. "South Africa has banned Bain \& Company from bidding for public-sector contracts for a decade, following the lead of the UK, after the consulting firm was accused of helping government officials degrade the South African Revenue Service's (SARS) ability to probe tax evasion. 2 National treasury said in a response to queries that the ban will last for a decade and relates to the company "engaging in corrupt and fraudulent practices related to a SARS contract". The UK in August banned Bain from public contracts for three years because of allegations related to SARS. Bain was found by a judicial commission to have had ties to illegal dealings during work restructuring Sars, where senior staff were ousted and the institution's investigative capacity was gutted." The economic problem shown in the extract is that of and has the consequence of (4 marks) a) Market failure, externalities. b) Government failure, public goods being underproduced. c) Market failure, inefficient allocation of resources. d) Government failure, public goods being overproduced. 1.11 The intervention by the South African government is that of: a) Market participation. b) Regulation. c) Government spending. d) Public provision of goods and services. 1.12 Study the following diagram and answer the question that follows. (4 marks) Figure 9.1 At an income level of $2,000 billion, (4 marks) a) Consumption equals $1,500 billion. b) Saving equals $0. c) The MPC equals 0.80. d) There is dissaving
