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ECS1501: Economics IA
OCT/NOV Examination 2026 Preparation
Covers Past Papers: 2023 to 2025
⋆ ⋄ ⋆ ⋄ ⋆ ⋄ ⋆ ⋄ ⋆
Economics & Microeconomics
⋆ Exam Revision Guide
ECS1501
Module Code:
Economics IA
Module Name:
OCT/NOV Examination 2026
Paper / Exam:
Past Papers 2023 to 2025
Covers:
100 marks (typical)
Total Marks:
2 hours
Duration:
Comprehensive Q&A revision covering all examinable topics from Oct/Nov 2023,
2024 and 2025 papers, with 2026 predictions.
⋆ Exam Revision Notes | ECS1501 | 2026
,ECS1501 | Exam Revision Oct/Nov 2023–2025 Papers
SECTION A: OCT/NOV 2025 EXAMINATION PAPER
Based on the ECS1501 syllabus and confirmed 2025 assessment patterns
Page 2 of 27 ⋆
,ECS1501 | Exam Revision Oct/Nov 2023–2025 Papers
Question 1 (2025) [20 marks]
(a) [4 marks]
Question: Define the concept of scarcity in economics and explain why it is considered
the fundamental economic problem. (4)
Answer:
Key Concept
Scarcity is the condition that arises because human wants and needs are unlimited
while the resources available to satisfy them are finite (limited). It is the core economic
problem that forces individuals, firms, and governments to make choices about resource
allocation.
Why scarcity is the fundamental economic problem:
• Unlimited wants: Human beings always desire more goods and services, and these de-
sires are never fully satisfied.
• Limited resources: The factors of production (land, labour, capital, and entrepreneur-
ship) are finite and cannot be expanded infinitely.
• Forces choice: Because not all wants can be met, individuals and societies must choose
which goods and services to produce, how to produce them, and for whom they are pro-
duced (the three basic economic questions).
• Opportunity cost: Every choice involves giving up an alternative, giving rise to the con-
cept of opportunity cost.
Example
South Africa faces scarcity in electricity (load-shedding is the result of limited gener-
ation capacity versus unlimited demand) and in skilled healthcare workers versus the
population’s medical needs.
Page 3 of 27 ⋆
,ECS1501 | Exam Revision Oct/Nov 2023–2025 Papers
(b) [4 marks]
Question: Define opportunity cost and illustrate it using a production possibilities
curve (PPC) diagram. (4)
Answer:
Opportunity cost is the value of the next best alternative forgone when a choice is made. It
reflects the real cost of any decision in a world of scarcity.
PPC illustration:
Good Y (e.g., Maize)
A
YA
OC
B
YB
Good X (e.g., Wheat)
XA XB
Moving from point A to point B on the PPC: more of Good X is produced, but the opportu-
nity cost is the reduction in Good Y from YA to YB . The PPC bows outward because of the
law of increasing opportunity cost — resources are not equally suited to the production
of all goods.
(c) [4 marks]
Question: Distinguish between the three types of economic systems: market economy,
command economy, and mixed economy. (4)
Answer:
Page 4 of 27 ⋆
,ECS1501 | Exam Revision Oct/Nov 2023–2025 Papers
Table 1: Comparison of Economic Systems
Market Economy Command Econ- Mixed Economy
Feature omy
By price mechanism By central govern- Combination of both
Resource alloca- (supply & demand) ment
tion
Private State Both private & state
Ownership
Decentralised (indi- Centralised (planners) Shared
Decisions viduals/firms)
USA (historically) Cuba, North Korea South Africa, UK
Examples
Exam Tip
South Africa operates as a mixed economy — state-owned enterprises (Eskom,
Transnet) coexist with private firms. This is a favourite exam context.
(d) [4 marks]
Question: Explain the difference between microeconomics and macroeconomics and
give one example of a question studied by each. (4)
Answer:
• Microeconomics studies the behaviour of individual economic units: households, firms,
and markets. It analyses how prices are determined and how individual agents allocate
scarce resources. Example question: What determines the price of bread in Johannesburg?
• Macroeconomics studies the economy as a whole, examining aggregate variables. Exam-
ple question: What determines South Africa’s national unemployment rate?
Table 2: Microeconomics vs Macroeconomics
Aspect Microeconomics Macroeconomics
Focus Individual units Whole economy
Variables Price of one good, firm’s output GDP, inflation, unemployment
Key tools Supply & demand, elasticity Aggregate demand & supply
Page 5 of 27 ⋆
, ECS1501 | Exam Revision Oct/Nov 2023–2025 Papers
(e) [4 marks]
Question: Explain the concept of positive and normative economics, and give one
example of each. (4)
Answer:
• Positive economics deals with factual, objective statements that can be tested empir-
ically. It describes what is. Example: “A 10% increase in the price of petrol reduces the
quantity of petrol demanded by 5%.”
• Normative economics deals with value judgements about what ought to be. It reflects
opinions or policy recommendations. Example: “The government should subsidise public
transport to help the poor.”
Watch Out
Do not confuse these two. Positive statements can be proved or disproved with data.
Normative statements cannot be tested — they depend on values and opinions. Exam-
iners frequently ask students to classify statements as positive or normative.
Page 6 of 27 ⋆
]]
ECS1501: Economics IA
OCT/NOV Examination 2026 Preparation
Covers Past Papers: 2023 to 2025
⋆ ⋄ ⋆ ⋄ ⋆ ⋄ ⋆ ⋄ ⋆
Economics & Microeconomics
⋆ Exam Revision Guide
ECS1501
Module Code:
Economics IA
Module Name:
OCT/NOV Examination 2026
Paper / Exam:
Past Papers 2023 to 2025
Covers:
100 marks (typical)
Total Marks:
2 hours
Duration:
Comprehensive Q&A revision covering all examinable topics from Oct/Nov 2023,
2024 and 2025 papers, with 2026 predictions.
⋆ Exam Revision Notes | ECS1501 | 2026
,ECS1501 | Exam Revision Oct/Nov 2023–2025 Papers
SECTION A: OCT/NOV 2025 EXAMINATION PAPER
Based on the ECS1501 syllabus and confirmed 2025 assessment patterns
Page 2 of 27 ⋆
,ECS1501 | Exam Revision Oct/Nov 2023–2025 Papers
Question 1 (2025) [20 marks]
(a) [4 marks]
Question: Define the concept of scarcity in economics and explain why it is considered
the fundamental economic problem. (4)
Answer:
Key Concept
Scarcity is the condition that arises because human wants and needs are unlimited
while the resources available to satisfy them are finite (limited). It is the core economic
problem that forces individuals, firms, and governments to make choices about resource
allocation.
Why scarcity is the fundamental economic problem:
• Unlimited wants: Human beings always desire more goods and services, and these de-
sires are never fully satisfied.
• Limited resources: The factors of production (land, labour, capital, and entrepreneur-
ship) are finite and cannot be expanded infinitely.
• Forces choice: Because not all wants can be met, individuals and societies must choose
which goods and services to produce, how to produce them, and for whom they are pro-
duced (the three basic economic questions).
• Opportunity cost: Every choice involves giving up an alternative, giving rise to the con-
cept of opportunity cost.
Example
South Africa faces scarcity in electricity (load-shedding is the result of limited gener-
ation capacity versus unlimited demand) and in skilled healthcare workers versus the
population’s medical needs.
Page 3 of 27 ⋆
,ECS1501 | Exam Revision Oct/Nov 2023–2025 Papers
(b) [4 marks]
Question: Define opportunity cost and illustrate it using a production possibilities
curve (PPC) diagram. (4)
Answer:
Opportunity cost is the value of the next best alternative forgone when a choice is made. It
reflects the real cost of any decision in a world of scarcity.
PPC illustration:
Good Y (e.g., Maize)
A
YA
OC
B
YB
Good X (e.g., Wheat)
XA XB
Moving from point A to point B on the PPC: more of Good X is produced, but the opportu-
nity cost is the reduction in Good Y from YA to YB . The PPC bows outward because of the
law of increasing opportunity cost — resources are not equally suited to the production
of all goods.
(c) [4 marks]
Question: Distinguish between the three types of economic systems: market economy,
command economy, and mixed economy. (4)
Answer:
Page 4 of 27 ⋆
,ECS1501 | Exam Revision Oct/Nov 2023–2025 Papers
Table 1: Comparison of Economic Systems
Market Economy Command Econ- Mixed Economy
Feature omy
By price mechanism By central govern- Combination of both
Resource alloca- (supply & demand) ment
tion
Private State Both private & state
Ownership
Decentralised (indi- Centralised (planners) Shared
Decisions viduals/firms)
USA (historically) Cuba, North Korea South Africa, UK
Examples
Exam Tip
South Africa operates as a mixed economy — state-owned enterprises (Eskom,
Transnet) coexist with private firms. This is a favourite exam context.
(d) [4 marks]
Question: Explain the difference between microeconomics and macroeconomics and
give one example of a question studied by each. (4)
Answer:
• Microeconomics studies the behaviour of individual economic units: households, firms,
and markets. It analyses how prices are determined and how individual agents allocate
scarce resources. Example question: What determines the price of bread in Johannesburg?
• Macroeconomics studies the economy as a whole, examining aggregate variables. Exam-
ple question: What determines South Africa’s national unemployment rate?
Table 2: Microeconomics vs Macroeconomics
Aspect Microeconomics Macroeconomics
Focus Individual units Whole economy
Variables Price of one good, firm’s output GDP, inflation, unemployment
Key tools Supply & demand, elasticity Aggregate demand & supply
Page 5 of 27 ⋆
, ECS1501 | Exam Revision Oct/Nov 2023–2025 Papers
(e) [4 marks]
Question: Explain the concept of positive and normative economics, and give one
example of each. (4)
Answer:
• Positive economics deals with factual, objective statements that can be tested empir-
ically. It describes what is. Example: “A 10% increase in the price of petrol reduces the
quantity of petrol demanded by 5%.”
• Normative economics deals with value judgements about what ought to be. It reflects
opinions or policy recommendations. Example: “The government should subsidise public
transport to help the poor.”
Watch Out
Do not confuse these two. Positive statements can be proved or disproved with data.
Normative statements cannot be tested — they depend on values and opinions. Exam-
iners frequently ask students to classify statements as positive or normative.
Page 6 of 27 ⋆
