Hkcee 2010 Econ Paper 2 Q2 Access
The HKCEE 2010 Economics Paper 2, Question 2 focuses on fundamental microeconomic concepts, specifically regarding Basic Concepts and the Three Basic Economic Problems. In the context of the Hong Kong Certificate of Education Examination (HKCEE), "Paper 2" refers to the Multiple Choice section. Question Analysis: HKCEE 2010 Econ P2 Q2
- Lack of close substitutes (e.g., limited alternative routes or modes).
- Necessity good (commuting for work/school).
- Small proportion of income spent on fares.
- Short-run adjustment period where habits are sticky.
Distributional concerns matter: pollution often disproportionately affects vulnerable communities, so policies may need compensation measures or targeted investment in local mitigation. Politically, firms may resist taxes or caps; phased implementation and stakeholder engagement reduce opposition. Where measurement of the marginal external cost is feasible, a properly set Pigovian tax is recommended; where uncertainty or heterogeneity is large, tradable permits with strong monitoring are preferable. In practice, combining market-based instruments with regulation and support for cleaner technology provides a balanced, implementable approach. hkcee 2010 econ paper 2 q2
Step 2 – Cross-price effect (substitute bus route):
The introduction of a lower-fare bus route is a substitute for MTR travel. For substitutes, a decrease in the price of the substitute (bus) reduces demand for the original good (MTR), shifting the MTR demand curve to the left. The HKCEE 2010 Economics Paper 2, Question 2
Summary for Revision
| Item | Included in HK GDP? | Reason | | :--- | :---: | :--- | | Exports (Goods/Services) | YES | Produced domestically, sold externally. | | Imports (Goods/Services) | NO | Produced externally. (Subtracted in formula). | | Foreigners earning in HK | YES | Production takes place within the territory. | | HK residents earning abroad | NO | Production takes place outside the territory (for GDP), but included in GNP. | Lack of close substitutes (e
However, the ceiling creates non-price rationing (queues, favoritism), which may waste resources.
(i) Opportunity Cost Increase: The opportunity cost of choosing to invest in shares increases if the expected return or value of the alternative (investing in property) increases. For example, if property prices are expected to rise significantly, the cost of "forgoing" that gain becomes higher.
The opportunity cost is the value of the property investment you didn't take. Since nothing changed regarding the property market, the opportunity cost remains constant. 4. Critical Exam Tip