TMJC_2024_H2 Econs CSQ1_Answers

JC2 H2 Economics 9570 2024 Prelim Suggested Answers & Markers Report 1 Tampines Meridian Junior College 2024 JC2 Prelim H2 Economics 9570 Paper 1 Question 1: The changing landscape of European Energy Market Suggested Answers a) i) Using Extract 1, explain one demand factor and one supply factor to account for the rise in price of liquefied natural gas (LNG) in Europe. [4] “heat waves in Europe have sparked stronger seasonal demand due to increased power demand, as the use of air conditioning climbs” → increase in demand for power/energy for the use of air conditioning → as LNG is a derived demand for energy → increase in demand for LNG “Heightened geopolitical tension, especially with the ongoing war in Ukraine and disruption of shipping on the Red Sea, has adversely affected LNG supply” → production process of LNG is disrupted with war → fall in supply for LNG The increase in demand and fall in supply will cause a shortage accounting for a rise in price. Markers’ Report Skills Strengths (+): What are the required skills that were well - demonstrated? Areas for improvement ( -): What are the skills that were lacking/ not well-demonstrated? Aha moment! (+) Students generally interpreted the question correctly i.e. they have elicited demand and supply factors and linked how these factors can result in a rise in price of LNG. (-) A significant minority of students did not explain how the shortage will eventually lead to a rise in price of LNG. Content Strengths (+): What are some concepts that were well - explained with clear linkages made? Areas for improvement (-): What are some concept gaps / conceptual errors? Aha moment! (-) However, a significant number of students merely elicited the evidence from the extract and stated that demand rose, and supply fell, without explaining the Economic concepts e.g. how the rise in demand for power for the use of air conditioning may result in the rise in derived demand for LNG is not clear.

JC2 H2 Economics 9570 2024 Prelim Suggested Answers & Markers Report 2 Tampines Meridian Junior College 2024 JC2 Prelim H2 Economics 9570 Paper 1 Hence, this means that the rigour in the explanation of factors is not evident. (-) A handful of students thought that power and LNG are complements instead of derived demand; the relationship between the 2 goods is not accurate. ii) Explain the likely value of price elasticity of supply for LNG. [2] “Bottlenecks and infrastructural limitations still exist in some regions” → supply will be more price inelastic and value of PES will be smaller than 1 due to lack of spare capacity /factor immobility as producers find it difficult to increase their production due to bottlenecks and infrastructural limitations. Markers’ Report Skills Strengths (+): What are the required skills that were well - demonstrated? Areas for improvement (-): What are the skills that were lacking