UNIVERSITY OF THE WITWATERSRAND JOHANNESBURG

SCHOOL OF ELECTRICAL & INFORMATION ENGINEERING

ECONOMICS OF ELECTRICAL ENGINEERING DESIGN

- ELEN3018 MACRO-ECONOMICS

CLASS TEST: 28th August 2013

TIME: 1½ HOURS (90 minutes) EXAMINERS: Mr. V Crone Mr. M Bernath

ANSWER ALL 3 QUESTIONS

QUESTION 1:
One of the most serious problems facing South Africa is the high unemployment rate. Below is a graph of the
unemployment trends over the last few years.

a. In your own words, discuss the probable causes of the high level and general shape of the unemployment
rate between January 2008 and the current date. [10 marks]
b. In your own words, discuss whether the current unemployment in South Africa is mostly structural,
frictional or cyclical. Give reasons for you answer. [5 marks]
c. Youth unemployment is stated to be ±50% and increasing, for those between 15 and 24. Give examples of
what the major South African players such as Government, Unions, Private Business, etc. have done/are
doing/ could do to reduce this unemployment rate. Explain, using economics concepts, what the effects of
these actions have been or could be. [10 marks]
Marks: 25
QUESTION 2:
Assume that you have developed an application that enables purchases on line and in shops and any
banking transactions using any mobile phone.
Draw up a brief marketing plan for such a business, detailing the market profile, competitive advantage
and using the 4 marketing Ps to explain how you would address the market. [20 marks].
Marks: 20
QUESTION 3:
a. Name and discuss three ways that the South African government can aid social progress by using taxation
as a base to incentivise or dis-incentivise behaviour. [6 Marks]
b. Describe how a 60% tax rate might decrease government revenue, making reference to the Laffer curve
and explaining some of the effects. [6 Marks]
c. Describe how the South African government can protect local industries using tax. [3 Marks]

Marks: 15

Total marks: 60
2013-08-23 10:20
Viv Crone
661322460.doc