Chapter 5 Flashcards
(22 cards)
What are the three economic sectors?
Primary - extraction of raw materials
Secondary - manufacturing process
Tertiary - where product or service is ready for resale
What do the three economic sectors refer to?
It refers to various stages that a product goes through from start to finish
Different types of natural resources in primary sector
South Africa :
- is rich in minerals
- has a long coastline that enables catches of a variety of fish to contribute
- fresh water is an essential resource, but is often a scarce resource in South Africa
- has a relatively favourable climate with fertile soil
- there are not too many natural forests, but we have many plantations of trees
The preservation of natural resources in primary sector
- Trees are chopped down, plant new ones
- Farmers should not allow soil to be overgrazed, and allow time for it to restore itself
- Government should build dams to conserve water
- People should not waste or pollute water
- Businesses should use biodegradable materials for products
- Businesses should recycle paper, glass and plastic
- Hydro, solar and wind should be developed
- Protect fishing industry by issuing permits and quotes
Type of skills that the primary sector needs
- They need a lot of physical work for manual labour
- People need to know how to operate different machines and they require training
- People are required to do planning, organised the necessary resources and take up leadership roles, to ensure smooth running and that everybody is working to the plan
Types of activities that take place in the secondary sector
Takes place in manufacturing plants and factories .
- construction, manufacturing of food, car manufacturers, clothing manufacturing, furniture makers, activities concerning engineering, chemical plants, manufacturing of electricity
The preservation of resources in the secondary sector
The secondary sector needs to be made aware of the impact they have on air, water and noise pollution
Types of skills that the secondary sector requires
- It is important for job creation, so employees must receive specific or specialized training in order to operate the machinery required to do their work
- Need many workers who have a good education to be employed
Types of activities that take place in the tertiary sector
- ## List would be very long
Types of skills that the tertiary sector requires
- Creative thinking and problem-solving skills
- Computer literacy and ability to use other technological tools
- Teamwork, tolerance with regard to cultural diversity and emotional intelligence
Economic growth
The country’s actual GDP grows from one year to the next
GDP
Refers to the total amount of final products and services that are produced within the country’s borders, in a period of a year
Real GDP
When we take into account that inflation can affect prices of goods and services. This leads to an artificial increase in the GDP
Economic development
- Economic development usually reflects the improvement of
long-term growth in the economy, jobs and income growth. It also involves sustainable
increases in the productivity of individuals, businesses and people, and maintaining and even
enhancing quality of life - With this, the average GDP improves and the majority of thee people in the country experience a higher standard of living
How should the 3 sectors be managed in order to increase the real GDP per capita?
- Human Capital
- Natural resources
- Capital formation
- Technology
- Institutions
What is the private sector?
It consists of all businesses that are privately owned, regardless of whether the business is in the formal or informal sector
Various forms of ownership like:
- sole proprietor, partnership, private company and public company
The formal sector
Consists of tax-paying businesses which the government is aware of
- Output of these businesses is included when the GDP is calculated
The informal sector
It includes all the economic activities that are not included in the GDP. Often referred to as the unrecorded portion of the economy
Characteristics:
- excluded from GDP
- unable to find jobs in the formal sector, develop entrepreneurial skills by creating own jobs
- lack of education contributes
Advantages of the informal sector in South Africa
- high unemployment rate, helps create work to survive
- if entrepreneurial skills are developed, maintains self-confidence
- capital requirements are small
- businesses keep prices low as there is competition
- sometimes activities develop to such a degree that some become part of the formal sector and pay tax
- create jobs for other people
Possible problems that could occur in the informal sector
- shortage of skilled entrepreneurs often lead to businesses failing
- goods and services are often low quality
- illegal activities are disadvantages for community
The public sector
Refers to the government’s involvement in the South African economy and its attempts to develop the economy with reference to inequities of the past
