Subject Structure
 
S4 Economics Subject Structure
Cycle No.
Contents / Key Points
1 – 4
 
 
1.    Basic Economic Concept
-          Scarcity, choice and opportunity cost
-          The three basic economic problems
-          Specialization and exchange
-          Positive and normative statements
 
5 – 13
2.    Production
-          Types / stages of production
-          Types of goods and services produced
-          Division of labour
-          Factors of production
-          Production and costs in the short run and long run
-          Expansion and integration of firms
 
14 – 18
3.   Ownership of firms
-          Forms of ownership
-          Shares and bonds as sources of capital
-          The objectives of firms:
-          Profit maximization and output determination
-          Other objectives: market share, provision of non-profit making services, corporate
            responsibility, etc.
 
19 – 24
4.    Market and Price
-          Law of demand
-          Individual demand and market demand
-          Individual supply and market supply
-          Interaction between demand, supply and price
-          Money price and relative price
-          Changes in demand and supply
-          Price elasticity of demand
-          Price elasticity of supply
-          Market intervention
 

 

 

S5 Economics Subject Structure
Cycle No.
Contents / Key Points
1 – 5
1. Competition and Market Structure
-          Perfect competition and imperfect competition
           (monopolistic competition, oligopoly and monopoly )
-          Profit maximization and output determination
6 – 12
2.   Efficiency, Equity and the Role of Government
-           Consumer surplus and producer surplus
-           Competition and efficiency
-           The roles of government :
-           market failure
-           equity and income inequality
13 - 14
3 Measurement of Economic Performance – National Income
-   Meaning of national income (GDP / GNP)
     -   Circular flow of economic activities
     -   GDP at current and constant market prices
     -   GDP at factor cost
     -   Per capita GDP: growth rate of GDP
     -   GNP = GDP + income from abroad
-   Uses and limitations of national statistics as
     an indicator of economic welfare and for
     international comparison
-    Measurement of the general price level
15 – 18
4.   Macroeconomic Problems
-          Inflation and deflation
-          Unemployment and underemployment
-          Business Cycle
19 - 24
5.   National Income Determination and Price Level
-          Aggregate demand
-          Reasons for a downward sloping AD curve
-          Determinants of aggregate demand
     -   Aggregate supply
         -   Reasons for an upward sloping SR AS curve
         -   Reasons for a vertical long run AS curve
         -   Factors affecting short run and long run AS
     -   Determination of level of output and price
         -   Determination of the equilibrium level of output
             and price level in the AS – AD model
         -   Change in the equilibrium level of output and
             price level caused by change(s) in the AD and /  or AS.
During the summer holiday, the following topics must be covered :
1)         Fiscal policy

 

 

S6 Economics Subject Structure
Cycle No.
Contents / Key Points
1 -2
1.      Money & Banking
-          Barter
-          Money
-          Banking
-          Hong Kong as a financial centre
3 – 4
2. Money supply and money creation
-          The issue of notes and coins in Hong Kong
-          Money supply
-          Money creation
-          The process of money contraction
5 – 6
3. Money demand and money market equilibrium
-          Factors affecting the allocation of wealth
-          Cost of holding money
-          Demand for money
-          Money market equilibrium and determination of equilibrium nominal interest rate
7
4.   Monetary policy and quantity theory of money
-          Monetary policy
-          Quantity theory of money
8 – 9
5.         International Trade (I) – free trade and principle of comparative advantage
-          Absolute advantage and comparative advantage
-          The principle of comparative advantage
-          Distribution of gains from specialization and trade
-          The presence of transport costs and transaction costs
-          Other reasons for international trade            
9 – 11
6.         International Trade (II) – trade barriers and external trade of Hong Kong
-          Free trade vs restricted trade
-          Types of trade barriers
-          Effects of tariffs and quotas on a small economy
-          External trade in Hong Kong
X’mas
holidays
7.         International finance – exchange rate and balance of Payments
-          Exchange rate
-          Effects of change in exchange rates on international Trade
-          The linked exchange rate system in Hong Kong
-          The balance of payments account
X’mas
Holidays
+ 12
8. Extension of Trade Theory, Economic Growth and Development (elective part)
-          Illustration of comparative costs and gains from trade with the aid of production
           possibilities frontier
-          Comparative advantage and its relation to Globalization
-          Measurement of economic growth and development
-          Factors affecting growth of an economy
-          The desirability and costs of economic growth
-          International / regional comparison