Friday, November 20, 2009

2009 'A' Level Paper 2

Section A (Micro):
1. Governments around the world protect consumers against market failure due to market dominance.
a) Analyse with supporting examples, how market dominance might lead to market failure. (10)
b) Assess the extent to which market dominance, rather than any other potential market failure, is the major cause of government intervention in the markets for goods and services within Singapore. (15)

2. A very popular band is due to play one concert at a 5000 capacity venue. The plan is to charge different prices according to the area in which the seat is located.
a) Explain whether this pricing policy could be considered to be an example of price discrimination. (10)
b) Discuss the problems that are likely to be faced in determining the prices to be charged for the seats. (15)

3. There have been large changes in the price of crude oil over the past few years.
Discuss what determines whether consumers or producers are more likely to bear the cost of these oil price changes. (25)

Section B (Macro):

4. The relative importance of the components of the circular flow of income for a small and open economy, such as Singapore, is likely to be different from a large and less open economy, such as the USA.
a) Explain this statement. (10)
b) Assess whether a change in the external value of its currency is more likely to have a larger impact on Singapore or the USA. (15)

5. Economic measures of the Singapore economy for 2007 indicate that GDP was S$243b. The current account on the balance of payments was S$59b in surplus.
a) Explain how you might use GDP and balance of payments data to measure the performance of an economy. (12)
b) Assess whether these economic indicators are the best measures of economic performance and standard of living in Singapore. (13)

6. An economist stated "The trend towards globalisation leaves no room for protectionism".
a) Account for the trend towards globalisation. (10)
b) Discuss whether you agree with the economist's view. (15)

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