2024 SAJC JC1 H1 Microeconomic Objectives & Policies Tutorial

MICROECONOMIC OBJECTIVES & POLICIES 1 Section A: Case Study Question Question 1 [2021 HCI H1 Prelim (Adapted)] Extract 1: Markets associated with climate change A Driving Stockholm County’s population was expanding fast by 20,000 people annually. With more than half a million cars zooming in and out of the city, bottlenecks and delays were becoming ever present, with potential to get even worse, deteriorating air quality in built up city areas. Stockholm officials decided upon a road-charging system. The concept was simple enough: each Swedish- registered vehicle entering and leaving the city ce ntre between 6:30 a.m. and 6:30 p.m. on weekdays would pay a fee - the equivalent of US$3. Communications about the benefits were especially important, not just about less traffic a nd reduced CO2 levels, but also about how the funds gathered would be channelled back into Stockh olm infrastructure. However, a key hurdle faced by the Swedish government is the limited avai lability of accurate cross-sectional data to determine the effects of such a fee on congestion patterns. B Single-use plastics Plastic production is expanding worldwide. Plastic contributes to greenhouse gas emissions at every stage of its lifecycle, from its production t o its refining and the way it is managed as a waste product. Disposable cutlery, glasses, plates and plastic cotton buds are among a selection of single-use plastics that were outlawed in March following a vote in the European Parliament. To be fully implemented in 2021, the ban is based o n the European Union’s single-use plastics directive and aims to tackle marine litter coming f rom the single-use plastic products most often found on European beaches. Sources: Various With reference to Extracts 1A and 1B, (i) Explain negative externalities in consumption and production using examples. [4] (ii) Discuss why one government chooses to use tax while the other adopts ban to achieve efficient allocation of resource. [8] [Total: 12 marks] ST ANDREW’S JUNIOR COLLEGE 2024 JC1 H1 ECONOMICS MICROECONOMIC OBJECTIVES AND POLICIES

MICROECONOMIC OBJECTIVES & POLICIES 2 Question 2 [2021 JPJC H1 Prelim] Fighting Climate Change Extract 1: Climate change threatens the world’s food supply, United Nations warns The world’s land and water resources are being exploited at “unprecedented rates,” a new United Nations report warns, which combined with climate c hange is putting dire pressure on the ability of humanity to feed itself. The report, highlighted that half-billion people are already living in places turning into desert, and soil is being lost between 10 and 100 times faster than it is forming. Climate change will make those threats eve n worse, as floods, drought, storms and other