RI Y5 H2 Promotion Examination - Paper 2 2018

9757/02/Promo/Y5/18 © RI 2018 [Turn over RAFFLES INSTITUTION 2018 YEAR 5 PROMOTION EXAMINATION Higher 2 ECONOMICS 9757/02 Paper 2 Essay Questions 25 September 2018 1 hour 30 minutes Additional Materials: Answer Paper Cover Sheets READ THESE INSTRUCTIONS FIRST Write your name, index number and civics class on all the work you hand in. Write in dark blue or black pen on both sides of the paper. You may use a soft pencil for diagrams, graphs or rough working. Do not use paper clips, highlighters, glue or correction fluid. Answer two questions. Start each question on a fresh sheet of answer paper. Attach a cover sheet and tie the answer to each question separately. The number of marks is given in brackets [ ] at the end of each question or part question. This document consists of 4 printed pages and 2 blank pages.

2 9757/02/Promo/Y5/18 © RI 2018 Answer two questions. 1 Income has been rising in Australia. However, butt er production has dropped by 18 per cent between 2016 and 2017 due to the diversion of milk fat towards production of more profitable dairy products such as cheese and cream. Assess how consumers and producers in the market for butter and its related mar kets might be affected by these events. [25] 2 In some markets, many small firms co -exist with large firms. While big coffee joints such as Costa Coffee, Starbucks and Coffee Bea n and Tea Leaf continue to expand, smaller independent coffee shops sellling artisan coffee are also seeing a sales boon. In other markets, there is dominance of large firms. (a) Explain possible reasons why some markets comprise of only large firms while in other markets, small firms can co-exist with large firms. [10] (b) Discuss whether consumers might win or lose when a market becomes dominated by a few large firms. [15] 3 (a) Using examples, explain why markets might fail where there is imperfect information and where there is asymmetric information. [10] (b) Evaluate the policies that governments may adopt to correc t for the above types of market failure. [15]

3 9757/02/Promo/Y5/18 © RI 2018 RAFFLES INSTITUTION 2018 YEAR 5 PROMOTION EXAMINATION Higher 2 ECONOMICS 9757/02 25 September 2018 COVER SHEET – ESSAY QUESTIONS Name: ______________________ Civics Class: ________________ Paper Question Marks Economics Tutor: ____________ 2 (write question attempted) /25

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5 9757/02/Promo/Y5/18 © RI 2018 RAFFLES INSTITUTION 2018 YEAR 5 PROMOTION EXAMINATION Higher 2 ECONOM