HKDSE Economics notes & practice
Notes and practice for the HKDSE Economics compulsory part, from opportunity cost to fiscal policy, written in the wording HKEAA marking schemes use.
- 1
Basic Economic Concepts
Scarcity, free and economic goods, opportunity cost and full cost, the three basic economic problems, positive and normative statements, property rights and interest.
- 2
Firms and Production
Types of production, factors of production, labour productivity and division of labour, the law of diminishing marginal returns, costs, economies of scale, and forms and expansion of firms.
- 3
Market and Price
Demand and supply and their determinants, related goods, equilibrium, price elasticity of demand and total revenue, and price controls, quotas, unit taxes and subsidies.
- 4
Competition and Market Structure
Perfect competition, monopolistic competition, oligopoly and monopoly compared, price takers and price searchers, sources of monopoly power, and Hong Kong's Competition Ordinance.
- 5
Efficiency Equity and the Role of Government
Consumer and producer surplus, efficiency and deadweight loss, externalities, public goods and the free-rider problem, and equity and the Gini coefficient.
- 6
Measurement of Economic Performance
GDP by the expenditure, income and value-added approaches, what GDP includes and excludes, GNI, nominal and real GDP, the GDP deflator, and the limitations of GDP.
- 7
National Income Determination and Price Level
Aggregate demand and aggregate supply, short-run and long-run equilibrium, demand-side and supply-side shocks, and inflationary and deflationary effects.
- 8
Money and Banking
Functions of money, Hong Kong's money supply (M1, M2, M3), the banking system and the HKMA, deposit creation and the banking multiplier, the quantity theory of money, the Linked Exchange Rate System and the Fisher equation.
- 9
Macroeconomic Problems and Policies
Unemployment and underemployment, inflation and deflation, the business cycle, taxation principles, fiscal policy, and monetary policy under the Linked Exchange Rate System.