3.1 Answer the following questions - NSC Economics - Question 3 - 2022 - Paper 2

Households benefit from tourism in several ways:

1. Direct Employment: Members of households earn income directly from tourism-related jobs such as tour operators and travel agents.

2. Indirect Benefits: Many households experience indirect benefits when members are employed in tourism sectors, such as hotels and restaurants.

3. Skills Development: Entrepreneurs and local residents gain skills through tourism activities, enhancing their employment prospects.

4. Infrastructure Improvement: Tourism encourages better local services and infrastructure, benefitting the community at large.

The base year in the table is 2018.

The South African Reserve Bank (SARB).

Hyperinflation refers to an exceptionally high and typically accelerating rate of inflation, where prices increase rapidly, causing a significant loss of real value in the currency. This can lead to a loss of confidence in the currency itself.

Measuring inflation is essential for several reasons:

1. Economic Policy: It helps policymakers make informed decisions regarding monetary policy and interest rates.

2. Cost of Living: It provides a measure for adjustments in wages and pensions to keep up with the cost of living.

3. Economic Indicator: It acts as a vital statistic for assessing the economic health of a country.

The inflation rate from 2020 to 2021 can be calculated using the formula:

Substituting the values from the table:

Cultural Tourism.

Robben Island.

Tourism is the activity of traveling to and staying in places outside one’s usual environment for leisure, business, or other purposes, typically for a duration of no more than one year. It encompasses various activities including cultural experiences, recreation, and relaxation.

Tourism growth is crucial for the government due to its ability to expand the tax base, create jobs, and stimulate economic development. Increased tourism can lead to higher tax revenues and support in reducing unemployment and poverty levels.

Crime can deter potential tourists from visiting a destination due to safety concerns. High crime rates can decrease tourist arrivals, leading to reduced income for businesses reliant on tourism and potential job losses.

Several factors contribute to the growth of the tourism industry in South Africa:

1. Increased Disposable Income: More people can afford to spend on leisure activities.

2. Improved Transportation: Enhanced transport and accommodation options make it easier for tourists to access attractions.

3. Awareness: More people are becoming aware of South Africa’s unique offerings, leading to increased visitor numbers.

An increase in prices of imported key inputs like oil can cause several negative effects on the domestic economy, such as:

1. Rising Production Costs: Increased costs may force businesses to raise prices, leading to inflation.

2. Decreased Exports: Higher production costs can make local goods less competitive on international markets.

3. Economic Slowdown: Higher costs can reduce demand for goods and services, leading to a slowdown in economic activity.