JC Economics Lecture Notes

JC Economics Lecture Notes

Are you looking for a set of JC Economics lecture notes for your Higher 1 (H1) or Higher 2 (H2) exams? Is your own set of lesson notes from your own school rather incomplete, and wishes to have one from the top tier schools of HCI, RI, DHS, etc?

We at Adam Smith Economics Tuition, have compiled a complete set of JC notes for students doing H1 & H2 Econs, for the latest syllabus of 8823 and 9757 respectively. We have painstakingly referred to the following varied sources:, which are recommended by SEAB as approved textbooks. Thus, we have done the reading and compilation, so you don’t have to! (Note: Those in italics mean they are referred to more than the rest. Note also that, we did not highlight the specific edition too, any edition in the past 10 years or so will suffice.)

(Note: You can do a Ctrl + P, to print this page, and save as a PDF file.)

1. Economics Today, by Miller, Roger
2. Economics, by Parkin, Michael 
3. Economics, by Sloman, John, Wride, Alison and Garratt, Dean 
4. Microeconomics: Principles, Problems and Policies, by McConnell, Campbell R and Brue, Stanley
5. The Economic Way of Thinking, by Heyne, Paul, Boettke, Peter and Prychitko, David
6. Economics, by Lipsey, Richard G and Chrystal, K Alec
7. Principles of Economics, by Mankiw, N Gregory Principles of Economics
8. A Microeconomics: A Contemporary Introduction, by McEachern, William
9. A Macroeconomics: A Contemporary Introduction, by McEachern, William

On top of the above textbooks, we did take the best remaining sections from selected junior colleges (DHS, HCI…) and put up this lecture notes set, completely FREE.


According to Cambridge – SEAB – UCLES the following is the syllabus for 8823 and 9757 Economics Syllabi.

H2 Economics Syllabus Content (Code: 9757)
Higher 2 (H2) Econs comprises 3 core themes:
–  The Central Economic Problem
–  Markets
–  The National and International Economy

Using the disciplinary thinking framework in A-Level Economics which focuses on decision-making, JC Economics students will have the opportunity to explain, analyse and apply economic concepts, theories and principles through the above themes. JC H2 pupils will also evaluate economic issues and policy choices in a real-world context (particularly in Case Study Questions) and appreciate the interconnectedness across the themes.



JC Econs Lecture Notes for Theme 1: The Central Economic Problem

Theme 1 introduces candidates to the Central Economic Problem of unlimited wants and limited resources. The scarcity of resources necessitates choice and leads to decision-making. Through examining how the concepts of scarcity, choice and opportunity cost are faced by economic agents (consumers, producers and governments), candidates will be able to understand the Central Economic Problem facing societies, and how economic agents use available information, and also consider perspectives, constraints, costs and benefits in their decision-making. Candidates will also understand that decisions made by economic agents often have both intended and unintended consequences. 

This theme provides the foundation for the study of microeconomic and macroeconomic topics in Markets (Theme 2) and the National and International Economy (Theme 3) respectively, where the decision-making approach and concepts of scarcity, choice and opportunity cost recur.


JC Econs Lecture Notes for Theme 1.1 Scarcity as the Central Economic Problem


A1.1 Scarcity as the Central Economic Problem
A1.1.1 Scarcity, choice and resource allocation
a. Concept of scarcity and the inevitability of choices by economic agents (consumers, producers and governments)
b. Concept of opportunity cost and the nature of trade-offs in the allocation of resources

(Go to Chapter 1: Introduction to Economics)

A1.1.2 Rational decision-making process by economic agents
a. Understanding objectives of economic agents: Consumers, Producers & Governments – maximisation of utility, profits and social welfare respectively
b. Recognising constraints, trade-offs, as well as intended and unintended consequences
c. Gathering information and considering perspectives
d. Weighing costs and benefits in decision-making: A marginalist approach to weighing costs and benefits is the expected approach. A complete Cost-benefit analysis (CBA) is not required.

(Go to Chapter 2: Marginalist Principle)



• Positive and normative economics: An awareness of the concepts of positive and normative economics is sufficient
• Microeconomics and macroeconomics: An awareness of the concepts of microeconomics and macroeconomics is sufficient.
• Scarcity, choice and opportunity cost
• Production possibility curve (PPC)
• Marginal cost, marginal benefit and marginalist principle
• Maximisation of utility: An awareness of how consumers allocate resources to maximise utility is sufficient. The formal derivation of
utility maximisation is not required.
• Maximisation of profit: Marginal Revenue = Marginal Cost (MR = MC)
• Maximization of social welfare: Marginal Social Benefit = Marginal Social Cost (MSB = MSC)


JC Econs Lecture Notes for Theme 2: Markets

In Theme 2, both H2 and H1 Economics pupils in JC
i) examine how markets deal with the Central Economic Problem
ii) examine how decisions are made by economic agents in markets.
iii) performs a microeconomic analysis of how markets function
iv) analyses how these markets may fail to achieve efficient and equitable outcomes.
v) understand how market forces of demand and supply interact to bring about market equilibrium (aka Market Mechanism).


In addition, A-Level Economics students
vi) will also examine the strategies of firms (Market Structures) to achieve their objectives.
vii) will be able to understand that while decisions made by consumers and producers are necessary for the functioning of markets, these decisions may lead to inefficient and inequitable outcomes (aka Market Failure)
viii) will be able to discuss how governments may intervene through public policy measures to improve efficiency and equity (or income inequality) while recognising limitations, unintended consequences and possible trade-offs of government intervention.


Finally, this theme 2 on markets provides candidates with insights into real-world micro economic issues and also creates opportunities to deepen their economic reasoning and analytical skills and to apply microeconomic concepts to both Singapore and the global economy.  Microeconomic concepts and theories in Themes 1 and 2 provide the foundation for candidates to extend their understanding of the microeconomy to the macro economy in Theme 3.



JC Econs Lecture Notes for Theme 2.1 Price Mechanism and its Applications


2.1 Price Mechanism and its Applications
2.1.1 Price mechanism and its functions
a. Resource allocation in a free market
2.1.2 Interaction of demand (DD) and supply (SS)
a. Determinants of demand and supply
b. Equilibrium price and equilibrium quantity
c. Changes in demand and supply leading to changes in market equilibrium

(Go to Chapter 3: Theory of DD)
(Go to Chapter 4: Theory of SS)
(Go to Chapter 5: Theory of Price Determination)

2.1.3 Applications of demand and supply analysis to real-world markets: *The focus is on the application of DD and SS analysis to any market. With reference to labour markets, Marginal Revenue Productivity (MRP) theory of labour is not required
a. Responsiveness of consumers and/or producers
• Price, income and cross elasticities of demand (PED, YED, and XED or CED) – determinants and significance
• Price elasticity of supply (PES)– determinants and significance
b. Impact of market outcomes on consumers and producers
• Consumer expenditure and producer revenue
• Consumer and producer surplus

(Go to Chapter 6: PED & PES)
(Go to Chapter 7: YED & XED)

c. Rationale and impact of government intervention on consumers and producers
• Taxes and subsidies
• Price controls – maximum and minimum prices (Progressive Wage Model in SG, a proxy to Minimum Wage?)
• Quantity controls – quotas

(Go to Chapter 8: Government Intervention in Markets 1)

B2.1. Concepts and Tools of Analysis

• Price mechanism
• Consumer sovereignty
• Ceteris paribus
• Effective demand
• Law of diminishing marginal utility (LDMU): *Technical analysis of the LDMU is not required
• Demand curve
• Change in demand vs change in quantity demanded
• Supply curve
• Change in supply vs change in quantity supplied
• Determinants of demand – non-price factors
• Determinants of supply – non-price factors
• Market equilibrium – equilibrium price and quantity
• Market disequilibrium – shortage and surplus
- Normal and inferior goods
- Complements and substitutes



JC Econs Lecture Notes for Theme 2.2 Firms and Decisions

A2.2. Economics Content

2.2 Firms and Decisions
2.2.1 Objectives of firms
a. Profit-maximising objective
• Marginalist principle in determining profit maximising output and price
b. Alternative objectives of firms
• Entry deterrence, revenue maximisation, profit satisficing, and market share dominance
2.2.2 Costs and revenue
a. Costs and revenue concepts*
• Distinction between short run and long run
• Average and marginal costs and revenue
• Internal and external economies and diseconomies of scale
* Derivation of cost and revenue curves is not required.
2.2.3 Firms’ decisions and strategies
a. Characteristics of market structures: Diagrammatic analysis of the comparison of types of market structure is not required.
b. Decisions and strategies including price and output, growth of firms, , diversification, innovation, product differentiation, competition vs collusion. (Note that for shut-down decision, diagrammatic analysis of P < AVC is not required, As for price discrimination, third degree price discrimination (PD) will suffice, can omit first & second degree. Also, diagram for PD is not required.)
2.2.4 Impact of decisions and strategies on consumers, firms and governments, including efficiency and equity, and consumer welfare.



B2.2. Concepts and Tools of Analysis

• Profit maximisation: Marginal Revenue = Marginal Cost
• Entry deterrence, revenue maximisation, profit satisficing, market share dominance
• Short run vs long run
• Fixed cost vs variable cost
• Total cost, average cost, marginal cost
• Total revenue, average revenue, marginal revenue
• Internal and external economies and diseconomies of scale (EOS and DEOS)
• Barriers to entry (BTE)
• Concentration ratio (CR): An awareness of the CR and its calculation is sufficient.
• Market structures
– Perfect competition, monopolistic competition, oligopoly, monopoly
• Price discrimination
• Shut-down condition
• Product differentiation
• Competition versus collusion
– Cartels, contestable markets
• Efficiency
– Allocative, productive and dynamic efficiency



JC Econs Lecture Notes for Theme 2.3 Market Failure

A2.3. Economics Content

2.3 Market Failure
2.3.1 Efficiency and equity in relation to markets

(Go to Chapter 9: Market Efficiency)

2.3.2 Market failure and its causes
a. Public goods
• Characteristics of non-excludability and non-rivalry

(Go to Chapter 10: Market Failure)
(Go to Chapter 11: Public Goods)

b. Positive and negative externalities in consumption and production
• Divergence between private cost/benefit and social cost/benefit
c. Merit and demerit goods
d. Market dominance
e. Information failure/imperfect information
f. Factor immobility
2.3.3 Government intervention in markets
a. Policy measures including taxes and subsidies, quotas and tradeable permits, joint and direct
provision, rules and regulations, and public education in addressing market failure
b. Effectiveness of policy measures and government failure


B2.3. Concepts and Tools of Analysis

• Market failure
• Allocative efficiency
• Deadweight loss
• Equity
• Marginal private benefit and cost
• Marginal external benefit and cost
• Marginal social benefit and cost
• Social versus private (market) optimum
• Over-consumption and production
• Under-consumption and production
• Public goods: – Non-excludability and non-rivalry
• Positive and negative externalities
• Merit and demerit goods
• Market dominance
• Factor immobility
• Information failure/Imperfect information: Imperfect info is synonymous with info failure. Asymmetric information – moral hazard, adverse selection: *Asymmetric info is a subset of info failure. Technical analyses of moral hazard and adverse selection are not required

For Microeconomics, start here with the chapter on Introduction to Economics.


For Macroeconomics, start here with the chapter on Introduction to Macroeconomics.