Hkcee 2010 Econ Paper 2 Q2

HKCEE 2010 Economics Paper 2 Question 2

The correct answer for is C . Question Summary

HKCEE Style:

• Equity: pollution often affects poorer residents disproportionately; compensation mechanisms might be needed.
• Administrative feasibility: measuring emissions, monitoring compliance, and enforcement costs.
• Political economy: firms may lobby against stringent measures; transitional assistance or phased implementation may improve acceptability.
• Uncertainty: imperfect information about MEC and abatement costs argues for flexible or adaptive policies (e.g., emissions trading with adjustable cap).

Section 6: How to Use This Analysis for HKDSE or IB Economics

Conclusion:

• The leftward demand shift reduces ridership, compounding the revenue loss from the fare cut.
• Only if the MTR fare cut were so deep as to make MTR cheaper than the bus (unlikely if bus is already low-fare) could demand become elastic and reverse the trend – but that was not suggested.

• Supply curve shifts upward by the tax amount.
• Price buyers pay increases, Price sellers receive decreases.
• Tax Burden: Shared between buyers and sellers depending on elasticity.
• Deadweight Loss: Occurs because the quantity traded is less than the equilibrium quantity.

According to Herman Yeung's analysis , many candidates failed to recognize that "scarcity" doesn't mean a good is "rare"; it simply means there isn't enough to satisfy everyone's unlimited wants. hkcee 2010 econ paper 2 q2

HKCEE 2010 Econ Paper 2 Q2 presented a scenario related to externalities: HKCEE 2010 Economics Paper 2 Question 2 The