2025 TJC P2 Prelim H2 Econs

TEMASEK JUNIOR COLLEGE 2025 JC2 PRELIMINARY EXAMINATION Higher 2 ECONOMICS 9570/02 Paper 2 15 September 2025 2 hours 30 min Additional Materials: six 4-page answer booklets READ THESE INSTRUCTIONS FIRST Do not turn over until you are told to do so. Answer booklets will be provided with this question paper. You should follow the instructions on the front cover of the answer booklet. If you need additional answer booklet, ask the invigilator for a continuation booklet. Answer three questions in total, of which one must be from Section A, one from Section B and one from either Section A or Section B. Begin each question on a fresh 4-page answer booklet. Indicate the question number clearly in your answers. The number of marks is given in brackets [ ] at the end of each question or part question. This document consists of 3 printed pages and 1 blank page.

2 Answer three questions in total. Section A One or two of your three chosen questions must be from this section. 1 Firecrackers are often used in many countries for celebrations and festivals. Whilst individuals see them as a form of enjoyment, there have also been cases where individuals are injured when setting them off and the explosive sounds cause noise pollution to residents nearby. As a result, some countries have resorted to banning them. (a) Explain two different reasons for the market failure associated with firecrackers. [10] (b) Discuss why some countries choose to ban firecrackers while other countries may utilise another type of intervention. [15] 2 Technological advancements have helped in the streamlining of processes and minimi sing waste in the automotive industry. This has resulted in reduced factory sizes and lowered rental costs for the U.S. automakers. On the other hand, the U.S. has increased tariffs on steel and aluminium imports, increasing costs for automakers, particularly those relying on imported parts. (a) Explain how the reduction in rental costs and the higher tariffs on steel will each affect the survival of US automakers. [10] (b) Discuss whether barriers to entry is the key determinant in a profit -maximising firm’s price and output decision. [15] 3 Indonesia, the world’s largest palm oil producer, announced that it will ban palm oil exports, a move that will impact global food prices by placing extra pressure on already steep cooking oil prices. Source: Straits Times, 25 April 2022 (a) Explain, using relevant elasticity concepts, how an increase in the price of palm oil will affect the total spending by consumers on palm oil and another alternative like soybean oil. [10] (b) Discuss the policies that a government can implement to lower the price of palm oil when confronted with an