OTE2601
EXAM PREP
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OTE2601 EXAM PREP 2024
SCOPE
● revise your study guide
● Assignments.
● Stokvels
● Flea market
● Teaching and learning methods
● Entrepreneurships and the economy
● Consumers cultivating conservation
● Marketing plan
● Financial management
STUDY GUIDE SUMMARY
Learning unit 1: The economy in a South African
context
1.1 THE ECONOMIC REALITY
Primary school learners need to understand the South African economy because it is vital for
their future. Many adults lack economic knowledge, which makes it necessary to introduce
Economic and Management Sciences (EMS) at an early stage in education. South Africa faces
challenges, such as addressing inequalities from the apartheid era while striving to keep up with
leading global economies. The youth, including primary school students, are a crucial part of the
country’s social, economic, and political future. They will become the leaders, entrepreneurs,
and valuable members of society. To prepare them for the world of work, it’s important that they
are well-informed about the economic environment they live in.
1.1.1 Defining Economics
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Summary: The word "economics" comes from the Greek words for "house" and "management"
and was originally about managing a household. Economics is now a social science focusing on
how people produce, distribute, and consume goods and services, and how they manage
resources. Lionel Robbins defined economics as studying how humans use limited resources to
meet unlimited needs. Central concepts in economics are scarcity (limited resources) and
choice (decisions about how to use resources). For example, when someone goes to the store
with limited money, they have to choose which items to buy and which to leave out.
In the school curriculum, Economic and Management Sciences (EMS) includes Business
Studies and Accounting and teaches learners how to manage resources, money, and economic
decisions. Four main factors are involved in production: natural resources (like water or
minerals), labor (people's skills and efforts), capital (tools and machines), and entrepreneurship
(combining resources to create products). Besides scarcity and choices, economics also deals
with inflation, unemployment, trade, and growth.
Paraphrased: The term "economics" originally meant managing a household, but now it's a
social science that studies how people manage the production, distribution, and consumption of
goods and services. Lionel Robbins described economics as the study of human behavior
regarding how to use limited resources for various needs. Key ideas in economics are scarcity
and choice—people have to decide how to use limited resources to meet their needs. For
example, a shopper with a small budget must choose which groceries to buy. In schools, EMS
covers these economic concepts and helps students understand resources and financial
management.
Simplified: Economics started as a way to describe how to run a house, but now it’s about how
we make, share, and use things like food, clothes, and money. Since there’s never enough of
everything for everyone, people need to make smart choices. For example, if you only have a
little money, you have to decide what to buy and what not to buy. In school, EMS teaches kids
how to understand money, work, and resources so they can make good decisions.
1.1.2 Economic Management
Summary: Economic management is about how people and businesses manage their
resources, income, and spending. Scientific methods are used to help businesses reach their
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goals. Primary school learners need to understand these basics to prepare them for the
economic world and the workplace.
Paraphrased: Economic management refers to how communities and businesses manage their
resources, money, and spending. Schools need to teach learners these skills to prepare them
for future economic challenges and the job market.
Simplified: Economic management means learning how to handle money and resources
wisely, which kids should learn in school to help them understand the world of work.
1.1.3 Participants in the Economy
Summary: There are three main participants in the economy: households (including learners),
the government, and businesses. All of them are trying to meet their needs with limited
resources, striving for prosperity. Learners are also participants in the economy because they
are part of the system and need to understand it.
Paraphrased: The economy includes households (like individuals and families), the
government, and businesses, all of which aim to meet their needs with limited resources.
Learners are also part of this process and should understand their role in it.
Simplified: Three main groups make up the economy: families, businesses, and the
government. Everyone is trying to use what they have to meet their needs, and even learners
are part of this.
1.1.4 The Economic Process
Summary: Economic activities are complicated because people realized that they could be
more productive by specializing in tasks. This led to trade and the creation of industries. The
process of economics includes producing goods, trading them, and then consuming them to
meet needs. Since resources are limited, both producers and consumers need to make choices
about what to make, how to make it, and for whom. This process drives economic theory and
behavior.
