SRJC_H2_ECONS_9757-1_QP

©SRJC 9757/01/Prelims/2018 [Turn over ECONOMICS 9757/01 Higher 2 Paper 1 10 September 2018 2 hours 15 minutes Additional Materials: Writing paper SERANGOON JUNIOR COLLEGE JC2 Preliminary Examination READ THESE INSTRUCTIONS FIRST Write down your name and civics group 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 all questions. Start your answers to each case study question on a new sheet of writing paper. At the end of the examination, fasten your answers to questions 1 and 2 separately. The number of marks is given in brackets [ ] at the end of each question or part question. This document consists of 8 printed pages.

©SRJC 9757/01/Prelims/2018 2 Answer all questions. Question 1: The Automobile Industry Extract 1: Scarce, expensive cobalt essential for electric cars Cobalt prices more than doubled in 2017, and rose to a record high early this year, driven by a rising demand for electric cars. Cobalt has been used for thousands of years to add blue colour in ceramics, glass and pottery, but now its main demand is as a key ingredient used in lithium ion batteries that power everything from Apple products to Tesla electric cars. The supply side of the price equation is also boosting cobalt's price. Cobalt is mostly retrieved as a by-product of the copper and nickel mining industry. The prices of copper and nickel have been persistently falling, making production at many locations uneconomic, forcing mines to close. So even though there is strong demand for cobalt, if the rest of the industry is suffering, cobalt production will too. Source: www.theglobeandmail.com, 27 Feb 2018 Extract 2: It’s time to end subsidies for green vehicles Norway reached a remarkable milestone in 2017, when it became the first country where zero- emission and hybrid vehicles accounted for more than half of new car sales in a calendar year. At the same time, however, the government of Norway announced that it wants to cut back lavish subsidies that allow citizens to save thousands of dollars on the price of a Tesla and other models, while sticking to its plan to make every new car sold a zero-emissions vehicle by 2025. The Norwegian experience sums up the debate over how best to move away from fossil-fuel cars and onto the next generation of ground transportation – that is, whether or not subsidies for customers are worth it. But it also raises the question of whether that debate has become a moot point. The switch to electric vehicles appears to be speeding up globally, largely fuelled by innovation and government policy in major markets. In China, the world’s biggest car market, a company ca