DHS Topical 2026 Prelim Essay Questions

2026 JC Prelims 1 compiled by 2.1 Price Mechanism and its Applications ACJC2026 Q1 Persistent supply disruptions have pushed the costs of coffee beans to the highest in 13 years. This will cause the price of a cup of coffee to increase sharply. (a) Explain why persistent supply disruptions lead to a sharp increase in the price of coffee and, explain how the impact on related markets depends on cross elasticity of demand. [10] (b) Discuss whether imposing a minimum price or providing a subsidy is a more appropriate policy for a government seeking to increase the incomes of coffee beans farmers. [15] ASRJC2026 Q2 Retirements of nurses are expected to outpace new entrants. This led to a sharp rise in wages of nurses in ageing economies. Increasingly, AI -powered monitoring systems are purchased by hospitals to make up for the shortage of nurses. Source: World Health Organization, 2026 (a) Explain how wage elasticity of demand and wage elasticity of supply can each account for the sharp rise in wages of nurses. [10] (b) Discuss the impact of the rise in wages of nurses on the hospitals’ revenue and on the revenue earned from the sale of AI-powered health monitoring system. [15] CJC2026 Q2 In 2024, Singapore completed its post-pandemic recovery, posting a surprising 4.4% economic growth despite global supply chain disruptions and the Goods and Services Tax (GST) hike from 8% to 9%. (a) With the aid of diagrams, explain why the post -pandemic recovery and supply chain disruptions might each cause an increase in household expenditure on necessities. [10] (b) Discuss whether the increase in GST is likely to raise tax revenue and whether it will negatively affect the economy. [15] DHS2026 Q1 During a recession, some governments provide wage subsidies to support firms. (a) Explain how a wage subsidy is likely to affect consumer surplus and producer surplus in the market for a good. [10] (b) Discuss whether the combined effect of a fall in household incomes and the provision of a wage subsidy is likely to cause the quantities of different goods sold to rise or fall. [15]

2026 JC Prelims 2 compiled by EJC2026 Q1 Land is a scarce resource and must be allocated among competing uses (residential, commercial, industrial and recreational). (a) Explain how a production possibilities curve can be used to illustrate the concept of opportunity cost and how the price mechanism can help to allocate scarce resources. [10] (b) Discuss whether demand factors or supply factors have greater impact on residential property prices. [15] HCI2026 Q1 In 2024, United Kingdom (UK) raised its national minimum wage to increase the income of low- wage workers amidst modest economic recovery. Some business owners, however, have expressed concern over higher wage costs, warning that these may ultimately be passed on to consumers through increased prices. (a) Explain why, for normal goods, an economic recovery will increase consumer expenditure by different extent, while higher wage costs can increase or decrease consumer expenditure. [10] (b) Discuss the intended consequence and unintended consequences when UK government raises the national minimum wage and consider whether you support UK’s decision to do so. [15] JPJC2026 Q1 Singapore welcomed about 16.5 million international visitor arrivals in 2024, an increase of 21.5% from 2023, reflecting the continued recovery of global travel following the COVID -19 pandemic. At the same time, the Government continued investing in touris m infrastructure, including airport expansion and improvements to tourist attractions, to support future growth. (a) Explain how a recovery from COVID -19 pandemic and the government continued investing in tourism infrastructure would affect the market for tourism in Singapore in the short-run and long-run. [10] (b) Discuss how an operator of a tourist attraction might make use of the price elasticity of demand and income elasticity of demand in making price and output decisions to increase profits. [15]

2026 JC Prelims 3 compiled by MI2026 Q1 A Certificate of Entitlement (COE) is a permit that a buyer must obtain through bidding before registering a car in Singapore. The quota for Category A COE, which covers smaller and less powerful cars, was cut by 2 per cent for the May to July 2026 tender period. The Category A COE premium rose sharply in the first bidding exercise of May 2026. Source: Adapted from LTA COE bidding results, May 2026 (a) Explain the factors that a consumer considers when deciding whether to buy a car. [10] (b) Discuss whether the quota set by the government or changes in demand are more significant in affecting consumers’ expenditure on cars in Singapore. [15] NJC2026 Q3 Price volatility in essential commodities is a recurring issue due to varying climatic conditions, often impacting the livelihoods of farmers. The Indian government purchased approximately 6.4 million metric tonnes of onions during 2023- 24 for its buffer s tock initiative. Such procurement initiatives ensured favourable prices for onion farmers throughout the year in 2023. Source: Adapted from The Financial Express, 5 February 2025 and Chinimandi, 27 March 2024 (a) Explain why the prices of essential agricultural commodities such as onions are typically more volatile compared to non-essential goods. [10] (b) Discuss whether a government buffer stock scheme is the best way of stabilising the price of onions in India. [15] NYJC2026 Q2 Singapore's semiconductor industry has expanded rapidly, creating a persistent shortage of engineers with specialised technical skills. The government has responded by allowing firms to hire qualified foreign professionals more readily, expanding local edu cation and training pathways and encouraging firms to adopt automation and AI -enabled technologies to raise productivity. Source: Ministry of Manpower; Singapore Economic Development Board, 2024-2026 (a) Using relevant elasticity concepts, explain how the signalling, incentive and rationing functions of rising wages may reduce but not necessarily eliminate the shortage of semiconductor engineers in the short run. [10] (b) Discuss whether expanding local education and training is the most effective way of alleviating the shortage of semiconductor engineers in Singapore in the long run. [15]

2026 JC Prelims 4 compiled by RI2026 Q1 Rare earth elements are critical inputs in the production of semiconductors, electric vehicles and other high-technology products. Rising incomes have contributed to strong growth in these industries, while the extraction of rare earth elements can be challenging and time-consuming. Producers in some industries have also explored alternative materials. (a) Explain why the above events have led to a sharp increase in the price of rare earth elements and the reasons why shortages may continue to occur despite higher prices. [10] (b) Discuss how the rise in the price of rare earth elements may affect two related markets. [15] RVHS2026 Q1 In 2024, crop disease contributed to poor cocoa harvests in major cocoa-producing countries. Cocoa is widely used in chocolate production. During this period, some consumers chose fruit- flavoured sweets instead of chocolate. Household incomes have also risen over recent years. (a) Explain how poor cocoa harvests may affect consumer expenditure on chocolate and producer surplus in the market for fruit-flavoured sweets. [10] (b) Discuss the combined effects of rising household incomes and poor cocoa harvests on the quantities of premium and budget chocolate sold. [15] SAJC2026 Q1 The Russia -Ukraine war, which began in February 2022, severely disrupted global wheat exports. Producers of staples such as bread and noodles and livestock farme