Answer to Question #135092 in Macroeconomics for December

Question

Read the following passage to answer question 60:
60. Based on the passage, which one of the following statements regarding supply factors and
demand factors that affect economic growth, is true?
[1] Creation of job opportunities for local communities will be positively influenced by demand
factors.
[2] The fact that companies operating in SEZs do not have to pay rent, is a demand factor that
will affect economic growth.
[3] Exports by firm’s operating in SEZs form part of supply factors.
[4] Tax relief, capital investment and training are not supply factors, nor demand factors.

Various countries, including South Africa, China and India, have established Special
Economic Zones (SEZs) within their domestic economies. Firms that operate within these
SEZs receive several incentives including tax relief, rent-free land, capital investment and
training. This is done with the expectation to increase exports and to create job opportunities
for local communities.

Answer 1

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