PAY HIKE FOR DOMESTIC WORKERS The Department of Employment and Labour's National Minimum Wage (NMW) Commission has recommended an above-inflation wage increase to the NMW for 2023, which could see the rate for domestic workers jump to R25,05 an hour. With the consumer price index (CPI) averaging around 7% in 2022, this would put the hike to around 8%. An increase of R25,05 would push the monthly rate to over R4 000 for a worker who works 8 hours a day, 20 days a month. This would be approximately R300 more than in 2022. 2.3.1 [Adapted from Business Tech] Identify the percentage increase in minimum wage in the extract above. (1) 2.3.2 2.3.3 Name any ONE factor that influences the quality of the workforce. Briefly describe the term market failure. (1) (2) 2.3.4 Why would the government intervene when there is imperfect competition in the market? (2) 2.3.5 How would minimum wages negatively affect the employers? (2 x 2) (4) 2.4 Discuss the role of the Competition Commission and the Competition Tribunal as institutions that promote competition in South Africa. (2 x 4) (8) 2.5 How would the provision of subsidies to producers positively influence the economy? (4 x 2) (8)

2.3.2: One factor that influences the quality of the workforce is education and training. A well-educated and trained workforce can contribute to higher productivity, innovation, and overall economic growth.

2.3.3: Market failure occurs when the allocation of goods and services by a free market is not efficient, leading to a misallocation of resources. This can happen due to externalities, public goods, asymmetric information, or monopoly power.

2.3.4: The government intervenes when there is imperfect competition in the market to prevent abuse of market power, protect consumers from exploitation, promote fair competition, and ensure that resources are allocated efficiently.

2.3.5: Minimum wages negatively affect employers by increasing their labor costs, potentially leading to reduced hiring, layoffs, or increased prices for goods and services. It may also impact the competitiveness of businesses, especially small enterprises.

2.4: The Competition Commission and the Competition Tribunal play crucial roles in promoting competition in South Africa. The Competition Commission investigates anti-competitive behavior, reviews mergers, and conducts market inquiries. The Competition Tribunal adjudicates cases referred by the Commission, making decisions on prohibited practices and mergers to ensure fair competition and protect consumer welfare.

2.5: Provision of subsidies to producers can positively influence the economy in several ways:

- Encouraging production and investment, leading to economic growth

- Supporting industries that provide essential goods or services

- Promoting employment and income generation

- Enhancing international competitiveness and trade balance

Explanation: