DSE 2023: Top tutor suggests preparing for economics exam by focusing on hot topics and potential challenges

Inflation

“Although the topic is simply just inflation, it implies four topics. Students should understand the tools to tackle inflation as well as its theories,” Yu explained.

He listed four key topics related to inflation: monetary policy tools, the quantity theory of money, the aggregate demand-aggregate supply (AD-AS) model, and the redistributive effect on income.

“Candidates need to understand the monetary policy tools which are used to control the inflation rate, such as the adjustment of discount rate … But students often fail to familiarise themselves with this topic,” the star tutor pointed out.

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Another two concepts to note are the quantity theory of money, which is an equation that explains how an increase in the quantity of money generates inflation, and the AD-AS model, which tackles inflationary gaps.

He added that the redistributive effect on income referred to inflation’s impact on purchasing power. “It indicates who are the winners and losers from inflation.”

This has always been a hot topic on the economics exam, but this year, Yu highlighted that students should pay attention to the historic inflation experienced in the United States and Europe.

Lantau Tomorrow Vision

To prepare for questions that test students’ application of economics concepts in real-world situations, Yu advised students to look at Hong Kong’s major infrastructure project, Lantau Tomorrow Vision.

“[Questions on] the project can feature ... budget analysis, as well as how the government finances the spending, statistics and government expenditure,” he said, adding that key concepts related to this topic included the AD-AS model and long-run aggregate supply (LRAS) analysis.

The tutor added: “Since infrastructure projects are often linked with environmental issues, candidates should also study the topic of externality.”

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Mirror concert

With the popular boy band’s concert being the talk of the town last year, Yu noted that the exam might ask students to examine the overwhelming demand for tickets and analyse measures to combat scalpers.

He highlighted a few relevant concepts: “The concert might involve topics like basic demand and supply analysis, cost analysis, prevention of the black market, real-name registration and how it could affect the cost of the concert tickets.”

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Covid-related issues

Although Hong Kong has lifted all of its social-distancing measures, pandemic-related topics might still appear in this year’s exam, such as lockdowns and vaccination.

“The exam papers were set last year ... when we were still struggling with Covid. It probably won’t appear next year, but this year we should still pay attention to the impact of Covid,” Yu explained.

Taking reference from the Hong Kong Examinations and Assessment Authority’s comments on the performance of last year’s candidates, Yu outlined a few common mistakes to avoid.

Beware of weak data interpretation

On Paper 1, the tutor noted that students were weak at data interpretation: “They didn’t know how to explain the data and apply the formula for calculation.”

He noted that although economics at the DSE level was not so focused on mathematics, equations and formulas were still key to many questions. “[Analysing] the data is not calculation, but candidates need to look at the numbers and find out the meaning.”

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Answer the keywords of the questions

Typically, student performances are marked as “good” or “satisfactory”, but last year’s exam saw one question that received the comment “poor”.

Yu referred to 2022’s Paper 2 Section B2 Question 10b. The question said the broadcast of the Olympic games in shopping malls helped increase business for some restaurants, and it asked how market mechanisms could help reduce the divergence between private and social benefits.

“In the past, these kinds of questions ... asked from the government’s perspective,” he said. “But last year, the question asked what can the market do, which caught candidates off guard as they were not prepared for it.”

He added: “Some students didn’t pay attention to the keyword or didn’t know how to answer it, so they still used the answer from the government aspect instead of talking about the external benefits [from market mechanisms].

If students are asked to analyse a topic, such as the Lantau Tomorrow Vision project, from a market aspect, the tutor warned that it would be much more difficult than answering from the government’s perspective.

Challenging data-response questions

Usually, the last question of Paper 2 Section B is about the comparison of two subjects, for example, whether the budget should be used for consumption vouchers or a new hospital.

Yu predicted this year’s question might ask students to compare the different stakeholders’ viewpoints on the issue. For example, it might list two pandemic measures, such as lockdown and the vaccination drive, and ask which proposal would be supported by stakeholders like online shops and restaurants.

He added: “Students often explain why they choose this proposal instead of the other. Sometimes, you can support or disagree with both. So they need a comprehensive approach to explain and compare the two proposals in different groups of stakeholders.”

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Time management

For students who often run out of time while finishing the papers, Yu suggested a 45-minute rule.

Paper 1, which accounts for 30 per cent of the subject, requires students to finish 45 multiple-choice questions in one hour.

The tutor said students who aimed to achieve Level 4 or above would need to get more than 30 questions correct. “Candidates should use 45 minutes to finish all the questions and save the last 15 minutes for final checking,” Yu said.

On Paper 2, the 2.5-hour exam comprises two sections: Section A short questions and Section B data-response questions. Applying the 45-minute rule, Yu advised students not to spend more than 45 minutes on Section A, while giving 45 minutes each to the two data-response questions in Section B. The last 15 minutes should be for final checking.

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Last-minute exam tips

Here is Yu’s advice for how to approach the exam:

1. Define the symbols or abbreviations that appear in your answers or equations. Otherwise, some marks might be deducted.

2. Express your answers comprehensively.

3. Pay attention to the spelling of the terms and theories.

4. Do not use colour pens to fill in the diagram – only use a black pen or pencil. Make sure your handwriting is legible.