YJC Prelim 08 H2 Econ Paper 2

YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE □ YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE □ YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE □ YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE □ YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE □ YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE □ YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE □ YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE □ YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE □ YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE □ YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE □ YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE □ YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE□YISHUN□JUNIOR□COLLEGE □ YISHUN□□JUNIOR□□COLLEGE□ □ JC□2□□PRELIMINARY□EXAMINATIONS□ □ □ H2 □ECONOMICS□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□9732/02□ □ PAPER□2□ □ □ □ □ □ □□□□□□□ 14th □August□2008□ □ Duration:□2□hours□15□min□ □ □ □ □ □ □ □ □ □ □ □ □ □ □ □ □ □ READ□THESE□INSTRUCTIONS□FIRST□ □ Write□your□name□and□CTG□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□highlighters□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□Section□B.□ □ □□ □ At□the□end□of□the□examination,□fasten□all□your□work□securely□together.□ The□number□of□marks□is□given□in□brackets□[□]□at□the □end□of□each□question□ or□part□question.□ □ □ □ □ □ □ □□□□□□□□□□□□□□□□□This□question□paper□consists□of□2 □printed□pages.□

Answer□three□questions□in□total.□ □ □ SECTION□A□ □ One □or□ two □of□your□three□chosen□questions□must□be□from□this□section.□ □ 1□□□ Given□that□Small□Medium□Enterprises□(SMEs)□cont ribute□about□50%□to□ Singapore’s□Gross□Domestic□Product,□does□this□mean□that□size□does□not□ matter□for□firms□to□survive□in□Singapore?□□□ □□□□□□□ □ □ [25]□□ □ □ 2□(a)□ Explain□how□the□pricing□and□output□decisions□ of□a□firm□in□an□oligopolistic□ market□are□affected□by□the□reactions□of□its□rivals.□□ □□ □ [10]□ □ □□□(b)□□Discuss□the□view□that□oligopolists□should□be□allowed□to□collude,□for□ example,□by□fixing□prices□or□by□undertaking□joint□research□and□product□ development.□□□□□□□□□ □ □ □ □ □ □ [15]□ □ □ 3□(a)□ Explain□how□the□environmental□costs□associate d□with□emission□of□ pollutants□by□firms□result□in□a□misallocation□of□resources .□□□ [10]□ □ □□□(b)□ Evaluate□the□effectiveness□of□the□current□me asures□that□are□adopted□to□ control□carbon□emissions□by□firms.□ □ □□□□□□□□□□□ □ [15 ]□□□ □ □ □ SECTION□B□ □ One □or□ two □of□your□three□chosen□questions□must□be□from□this□section.□ □ □□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□ 4□ How□far□do□you□agree□that□low□interest□rates□and□ low□inflation□are□the□ most□important□aims□of□government□policy□in□maximising□economic□ welfare?□ □ □ □ □ □ □ □ □ [25]□ □ □ 5□(a)□ Explain□the□possible□impact□of□the□recent□inc reases□in□the□price□of□oil□on□ a□country.□ □ □□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□□ □□□□□□□□□□□□ □ [10]□ □ (b)□ Discuss□the□possible□measures□that□government□c an□take□to□overcome□ the□problems□that□arise□from□the□increase□in□the□price□of□oil.□□ [15]□ □ □ 6□ □ ‘Free□trade□and□specialisation□enable□goods□and□ services□to□be□obtained□ as□cheaply□as□possible□and□should□always□be□encouraged.’□Do□you□ agree?□ □ □ □ □ □ □ □ □ [25] □