True Light Middle School of HK

2020-21 S4 Economics
Test 2
Topics: Ch 3 – 4 Name: ___________________
Date: 18 – 12 – 2020 Class : ___________ ( )
Total No. of Pages: 3 Block :

QUESTION-ANSWER BOOK OF PAPER 2

(Time Allowed: 35 minutes)

Instructions:

1. Paper 2 consists of 4 questions and carries 30

marks. Question
Mark
2. All the answers must be written on the single No.
line paper.
3. Candidates can use calculator which is
1 / 5
approved by the public examination to find
answers. 2 / 4
4. Hand in the question after test.
3 / 6

4 /15

Total /30

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 Section A: Questions (15 marks, 15 minutes)

1. The table below shows the production information of Firm A and Firm B:
Firm A Firm B
Number of workers employed 80 50
Total number of working hours of the firm (Hours) 600 500
Output (Units) 48 000 44 000

(a) Calculate the labour productivity of each firm. Which firm has a higher labour
productivity? (3 marks)
(b) Why is there such a difference in the labour productivities of the two firms? Give
ONE reason to explain your answer. (2 marks)

Answers written in the margins will not be marked.

Answers written in the margins will not be marked.

2. Study the following information.

Cathay Pacific job cuts will hit Hong Kong housing market in
Tung Chung

With Hong Kong airport located in Chek Lap Kok, many people in the flight
service industry would live in Tung Chung. Residential rents in locations such
as Tung Chung and Tsing Yi, where a considerable number of Cathay
employees reside, are seen declining by between 5 per cent and 10 per cent. It
is reported that the axed pilots and cabin crew having difficulty in finding
other jobs and some of them decided to leave Hong Kong for good.

According to the above information,

(a) explain what type of division of labour is involved? (2 marks)
(b) What is the one disadvantage of the division of labour shown in the above case?
Explain your answer. (2 marks)

Answers written in the margins will not be marked.

Go on to the next page
2020-21 S4 ECON Test 2 (Paper 2) - 2
 3. Study the following information

Tuen Mun – Chek Lap Kok Link

The Hong Kong Government has spent about $47 billion and 7 years constructing the
Tuen Mun – Chek Lap Kok Link (屯門至赤鱲角連接路). It is expected to reduce the
journey time between Northwest New Territories and Lantau to alleviate the traffic
congestion of the North Lantau Highway by shortening the travelling time from 30
minutes to 10 minutes.

(Source: Extracted from Econ School 20-21 18 Nov 2020 p.9)

(a) To what type of factors of production do the link belong to? Explain.
(2 marks)

Answers written in the margins will not be marked.

Answers written in the margins will not be marked.

(b) Explain if there is any change in the

(i) occupational mobility; and
(ii) geographical mobility
of workers living in Tuen Mun and Chek Lap Kok (4 marks)

 End of Section A 

Section B: Structured Questions (15 marks, 20 minutes)

4. Mary runs a coffee shop in Central. She makes different tastes of coffee by herself and
sells them out in the shop. She also employs one shopkeeper, Tiffany, who is paid on an
hourly rate based on the statutory minimum wage rate to receive orders at the shop. One
day, Tiffany got a fever and could not work. As a result, Mary was also required to do
Ada’s work. Many customers complained to wait in a queue for more than an hour and
some refused to wait and left finally.
(a) To what type(s) of factors of production does Mary belong? Explain your answer.
(4 marks)
(b) What economic principle is adopted by the ice-cream puff shop? Briefly explain.
(2 marks)
(c) (i) Explain which wage payment method is adopted to pay for Tiffany. (2 marks)
(ii) From the viewpoint of Mary, explain ONE advantage and ONE disadvantage
of the above wage payment method over piece rate. (4 marks)
(d) (i) Name the returns of Mary and Tiffany respectively. (1 mark)
(ii) Compare the difference between Mary’s and Tiffany’s returns (2 marks)

 End of Q & A 

Answers written in the margins will not be marked.

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2020-21 S4 ECON Test 2 (Paper 2) - 3