Explain VAT exclusive, calculate the most economical transport option for Lebo (flight vs bus), and give a reason to prefer flying.

VAT exclusive means that the stated price does not include Value Added Tax (VAT). The VAT amount must be calculated and added to this price to determine the total amount payable.

$$\boxed{\text{VAT exclusive means the price does not include Value Added Tax.}}$$

The VAT rate is 15%.

• Option 1: Flight The cost is R480 VAT inclusive for a one-way ticket. Lebo is travelling from Durban to Johannesburg and back to Durban, which means two one-way tickets.

  $$\text{Total cost for flight} = \text{R}480 \times 2$$ $$\text{Total cost for flight} = \text{R}960$$

• Option 2: Bus The cost is R1 480 VAT exclusive for a return ticket. To make it VAT inclusive, we add 15% VAT.

  $$\text{VAT amount} = \text{R}1480 \times 0.15$$ $$\text{VAT amount} = \text{R}222$$ $$\text{Total cost for bus} = \text{R}1480 + \text{R}222$$ $$\text{Total cost for bus} = \text{R}1702$$

Comparing the two options:
Flight: R960
Bus: R1 702

The flight is the most economical option.

$$\boxed{\text{The flight is the most economical option at R960.}}$$

People often choose to fly because it is significantly faster and saves a lot of travel time compared to travelling by bus.

$$\boxed{\text{Flying saves a significant amount of travel time.}}$$

• Travel by bus: R960
• Accommodation: $\text{R}450 \text{ per day} \times 5 \text{ days} = \text{R}2250$
• Food: $\text{R}250 \text{ per day} \times 5 \text{ days} = \text{R}1250$
• Transport in Johannesburg: $\text{R}60 \text{ per day} \times 5 \text{ days} = \text{R}300$
• Johannesburg Zoo Entrance Fee: R120
• Gold Reef City Entrance Fee: R265
• Sci-Bono Discovery Centre Entrance Fee: R60
• Apartheid Museum Entrance Fee: R150

$$\text{Total Expenses} = \text{R}960 + \text{R}2250 + \text{R}1250 + \text{R}300 + \text{R}120 + \text{R}265 + \text{R}60 + \text{R}150$$ $$\text{Total Expenses} = \text{R}5355$$ $$\boxed{\text{R}5355}$$

• Birthday money from friends: R1 500
• Money from part-time job: $\text{R}80 \text{ per hour} \times 21 \text{ hours} = \text{R}1680$
• Money from Labo's savings: R900
• Contribution from parents: R1 000

$$\text{Total Income} = \text{R}1500 + \text{R}1680 + \text{R}900 + \text{R}1000$$ $$\text{Total Income} = \text{R}5080$$ $$\boxed{\text{R}5080}$$

It is important to save money every month to build an emergency fund for unexpected expenses or financial difficulties.

$$\boxed{\text{To build an emergency fund for unexpected expenses.}}$$

ATM stands for Automated Teller Machine.

$$\boxed{\text{Automated Teller Machine}}$$