1. Exchange Hundreds of years ago, most people were self sufficient
Now we rely on markets
Money is exchanged for goods and services
Before the existence of money, bartering was used for exchange
It is still used in some forms today eg Oil for arms

2. Money as a means of exchange
It facilitates exchange easier than barter
Money has the following functions:
places a value on goods
It is a store of value
It is a recognised medium of exchange

3. Money and banking
The first banks were merely a place of safekeeping while merchants travelled
Today electronic banking makes exchange easier
Banks provide services such as savings, loans, transfers, settling of payments etc

4. Foreign trade Countries produce different goods
Some produce many goods but not all equally well
This is when they specialise and import the goods they have given up producing
Foreign trade is essential for economic welfare
It leads to wide variety of goods, higher standard of living, generates income

5. Importing and exporting is the way that international exchange takes place
Importing Nike from USA means we have to pay in $
The price of $ is quite high as the $ is stronger than the R
The price of foreign currency is called the exchange rate
We buy $ on FOREX markets

6. Discussing Foreign trade
Who do you think are the worlds richest countries?
Why are they rich?
Do they trade a lot and with whom?
How can poorer countries become richer through trade?
Why are some poor countries “excluded” from trade?

7. Economics & the Environment
The population of the world is 6.7 billion
Our increased consumption requires environmentally harmful production
Governments have a responsibilty to weigh up costs & benefits of production
While the private cost of a new factory may be R500 million, the pollution caused may cost R1 billion to clean up - the disease and death associated is incalculable – ie the social cost