ACJC_H1_ECONS_P1_QP

1 ©ACJC2017 Preliminary Exam 8819/01 [Turn over ANGLO-CHINESE JUNIOR COLLEGE 2017 JC2 PRELIMINARY EXAMINATIONS ECONOMICS 8819/01 Higher 1 Paper 1 14 August 2017 3 hours Additional materials: Writing Paper READ THESE INSTRUCTIONS FIRST Write your index number and name 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 any diagrams, graphs or rough working. Do not use staples, paper clips, highlighters, glue or correction fluid / tape. Section A Answer both questions. Begin each case study question on a fresh sheet of paper. Section B Answer one question. Begin the essay question on a fresh sheet of paper. At the end of the examination, fasten your answers for each question separately to the cover sheets provided. The number of marks is given in brackets [ ] at the end of each question or part question. This document consists of 7 printed pages. Please check that your question paper is complete.

2 ©ACJC2017 Preliminary Exam 8819/01 Section A Answer all questions in this section. Question 1 The Market for Higher Education Table 1: Singapore government’s expenditure per student (Singapore Dollars) 2012 2013 2014 2015 Primary 7396 8549 9123 10,160 University 20,777 21,870 22,181 22,058 Source: Education Statistics Digest 2016, Ministry of Education Extract 1: Singapore government’s spending on higher education There are compelling reasons to heavily subsidise higher education. Firstly, there are p rivate returns such as higher employability and wage s as well as positive social returns to higher education, in terms of lowering poverty and crime rates. Societies that have better educated populations tend to have lower crime rates, enjoy greater social cohesion and a well-educated labour force that is needed for long-term economic development. Secondly, there is a case for the g overnment to intervene to ensure that there are equal opportunities. While it is generally feasible for individuals to fund their own tertiary education through loan schemes, the lower-income group may face credit constraints. Others may have heavy financial responsibilities that compel them to enter the labour market as soon as possible, rather than contemplate further education. Evidence also suggests that the lower - income group tend to underestimate the returns to education, due to lack of information and poor community role models. To encourage this group to take up higher education, the government provides financial assistance for higher education. There are also student and tuition fee loan schemes provided for the middle-income group at low interest rates. The Singapore government has always invested heavily in education and will continue to do so in future, with greater emphasis on developing higher education. This requires a careful balancing between strategic considera