HCI_H2 Econ Prelims P2

HWA CHONG INSTITUTION Preliminary Examinations 2008 General Certificate of Education Advanced Level Higher 2 ECONOMICS 9732/02 PAPER 2 Essays 8 September 2008 2 hour 15 minutes Additional Materials: Answer Paper READ THESE INSTRUCTIONS FIRST Write your name and CT 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. Answer three questions in total, of which one must be from Section A, one from Section B and one from either Section A or B. At the end of the test, fasten all your work securely together with this cover sheet on top. The number of marks is given in brackets [ ] at the end of each question or part question. COVER SHEET Name : CT Class : Econ Tutor : Please indicate the questions that you have attempted. For Examiner’s Use Only Question No. Marks Initial Total This document consists 2 printed pages. HWA CHONG INSTITUTION [Turn over ©HCI Prelims 2008 9732/02/N/08

©HCI Prelims 2008 9732/02/N/08 2 Answer three questions in total. Section A One or two of your three chosen questions must be from this section. 1 (a) Explain the basic economic problem of scarcity. [12] (b) Discuss whether Singapore’s high economic growth solves the problem of scarcity? [13] 2 “The new Beijing-Shanghai line is being built to improve journey times and ease pressure on existing railway corridors between the two cities.” http://www.railway-technology.com/projects/beijing/ (a) Explain & illustrate what is meant by a private good, a public good and a merit good. [12] (b) Discuss whether the above concepts are of any use in explaining why it is often the government and not the private enterprise that is responsible for the dev elopment and operation of the railway transportation system. [13] 3 “MS Ruth Chua is 19 and has a 50-hour work week, but s he is not part of the button-down corporate world. Instead, she scours places such as Chinatown and Little India for kitschy clothes and sells them on her blog, called Lyla Rose. An increasing number of enterprising teens are turning to blogshops to make a quick buck.” The Straits Times 14 Aug 2008 (a) Explain the market structure that blogshops are likely to operate in. [10] (b) If Ruth hires you as an economic consultant, discuss how relevant are the various demand elasticity concepts if she wants to maximise her sales reve