PJC_H2_ECONS_P2

Name: Centre No. / Index No.: / Class: Pioneer Junior College 2017 9757 / 02 / Preliminary Exam / 2017 [Turn over PIONEER JUNIOR COLLEGE, SINGAPORE JC2 Preliminary Examination 2017 Higher 2 ECONOMICS Paper 2 Additional Materials: Answer Paper 9757/02 19 September 2017 2 hours 15 minutes READ THESE INSTRUCTIONS FIRST Write your index number, 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, 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 Section B. Answer each question on a fresh sheet of paper. At the end of the examination, fasten your answers to each question SEPARATELY. The number of marks is given in brackets [ ] at the end of each question or part question. If there are part questions you did not attempt, pl ease write the question number and part in the margins before you submit your answers. (i.e. if you did Q1 and Q2, but you did not complet e 2b, indicate 2b in the margin of the answer script that you submit for question 2.) You are advised to spend several minutes reading th e question and planning your answers before you begin writing. You are reminded of the need for good English and clear presentation in your answers. This document consists of 3 printed pages and 1 blank page. Pioneer Junior College Ministry of Education

2 Pioneer Junior College 2017 9757 / 02 / Preliminary Exam / 2017 Answer three questions in total. Section A One or two of your three chosen questions must be from this section. 1 Oil prices have fallen after the OPEC group of oil producing nations said global crude stocks had risen coupled with Saudi Arabia's production increasing to 10.011 million barrels per day from 9.748 million barrels per day. In addition, a weaker econ omic outlook means demand for oil in 2017 is likely to grow at a slower rate. Discuss how the above events are likely to impact the market for oil and its related markets. [25] 2 The firm’s decisions and strategies are affected by cost, revenue, and threat from existing and potential competitors. (a) Explain how producers in imperfect markets make rational price and output decision based on cost and revenue consideration. [10] (b) Discuss the extent to which the behaviour of firms is influenced by the threat of competition. [15] 3 The biggest four airlines in America now control 80 % of the market. The US Environmental Protection Agency (EPA) has said that greenhouse ga ses from aircraft endan