2022 H2 Economics EOY P2 Suggested Ans.docx

Class Adm No Candidate Name: 2022 Preliminary ExamsPre-university 3 ECONOMICS 9757/02 Paper 2 Essays 14 September 20222 hours 15 minutesAdditional Materials: Answer Booklet READ THESE INSTRUCTIONS FIRST Write your name and 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 any diagrams or graphs.Do not use staples, paper clips, highlighters, glue or correction fluid. Answer threequestionsintotal,ofwhichonemustbefromSectionA,onefromSectionBandonefromeitherSection A or Section B. You are reminded of the need for clear presentation in your answers. Ananswer booklet will beprovidedwiththisquestionpaper. Youshouldfollowtheinstructionsonthefront cover of theanswer booklet. If youneedadditional paper, asktheinvigilator for acontinuation booklet. The number of marks is given in brackets [ ] at the end of each question or part question. This question paper consists of3printed pages and1blank page. [Turn over

2 Answerthreequestions in total. Section A Oneortwoof your three chosen questions must befrom this section. 1. When Malaysia announced it will ban exports of fresh chicken fromJune 1 st givendomestic shortages, Singapore felt a sense of unease given that chicken is acommoningredient inSingaporecuisine.Manypeoplebegantostockuponchicken.About 34 per cent of our chicken imports come from Malaysia. Source: CNA, 12 June 2022 (a) Explain howthe export ban will lead to shortages and a sharp riseinpricesoffresh chicken in Singapore. [10] (b) Assessthestrategiesthat theSingaporegovernment couldadopt inresponsetoMalaysia’s export ban of fresh chicken. [15]---------------------------------------------------------------------------------------------------------------------------Suggested Answer Part (a) Question RequirementsCommand words: ExplainContent/concept words: Sharp rise in prices due to Demand and Supply Factors / PEDand PESContext: Fresh chicken in Singapore Requirement Suggested Answer Introduction The ban exports of fresh chicken and the stocking up of chicken,coupled with the inelastic supply and demand will cause the price ofchicken to rise sharply. Body 1: Export banfall in Supplywith |PED| < 1 The supply of chicken refers to the various quantities of chickenproducersarewillingandabletoofferforsaleatvariouspricesoveraperiod of time, ceteris paribus/Since Malaysia supplies about 30% of Singapore’s chicken, theimplementationwoulddecreasethesupplyof chicken, thiswill causethe price of chicken rise.Theriseinpriceof chickenisalsoaccentuatedbythepriceinelasticdemand for chicken in which price elasticity of demand (PED)measures the degree of responsiveness of quantity demanded of agood to a change in its own price, ceteris paribus. MI/9757/02/PU3/EOY2022

3 The demand for chicken is price inelastic, since there are fewsubstitutes for chicken, and is also a necessity as it is a commoningredient in many dishes in Singapore cuisine.This fall in supplywouldleadtoariseinpriceandfall i