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HKDSE Economics Paper 1 Mock Paper (2027): 20 Multiple-Choice Questions with Answers
TUTORZONE ORIGINAL MOCK PAPER · HKDSE ECONOMICS PAPER 1
Written to the HKEAA 2027 framework: Economics Paper 1 is multiple-choice, 30% of the subject, 1 hour, set on the Compulsory Part and all compulsory; Paper 2 is 70% over 2 h 30 min (Section A short questions 26%, Section B 35%, Section C 9%). This paper has 20 MC items with answers and explanations.
What is in HKDSE Economics Paper 1?
Direct answer: Paper 1 is entirely multiple-choice, 30% of the subject in 1 hour, set on the Compulsory Part, all compulsory. Paper 2 is 70% over 2 h 30 min (Section A short questions 26%, Section B 35%, Section C 9%). There is no SBA in Economics.
Assessment at a glance (2027)
| Component | Content | Weighting | Duration |
|---|---|---|---|
| Paper 1 (multiple-choice) | Compulsory Part; 30% of the subject mark | 30% | 1 hour |
| Paper 2 (Compulsory Part, separate paper) | 70% over 2 h 30 min: Section A 26%, Section B 35%, Section C 9% | 70% | 2 h 30 min |
Sixty minutes for 20 MC items is three minutes each. Start with the calculations (elasticity, GDP, money supply, multiplier) since they are objectively right or wrong, then use elimination on the concept items.
How this paper was built
This is a TutorZone original mock paper: the questions follow the 2027 framework’s structure (Paper 1 MC at 30% in 1 hour) and the answers are our own, not HKEAA past papers or marking references.
HKEAA publishes no fixed question count for Paper 1, so this paper sets its own: 20 items. Every numeric answer was recomputed programmatically.
Pacing
| Section | Marks | Suggested time | What to do first |
|---|---|---|---|
| Paper 1 (multiple-choice) | 30% | 60 min (2-3 min per item) | Do the calculations first, then the concept items |
| Paper 2 (Compulsory Part, separate paper) | 70% | not covered here | This paper covers Paper 1 only |
How should the 60 minutes be split?
Direct answer: 20 items in 60 minutes is three minutes each. Do the calculable items first (elasticity, GDP, money supply, multiplier), then the concept items, and keep five minutes to check your answers.
Paper 1: multiple-choice (20 questions)
Aim for 60 minutes; do the calculations first.
Question 1
The price of a good rises from $10 to $12 (+20%) and quantity demanded falls from 100 to 80 units (−20%). What is the price elasticity of demand?
A. 1B. 0.5C. 2D. 0.8
Question 2
Choosing plan A means giving up plan B ($500) and plan C ($800). What is the opportunity cost?
A. $500B. $800C. $300D. $1 300
Question 3
An economy: consumption 800, investment 200, government spending 300, exports 150, imports 100 (in billions). Find GDP by the expenditure approach.
A. 1 550B. 1 250C. 1 450D. 1 350
Question 4
The CPI rises from 120 to 126. What is the inflation rate?
A. 4.8%B. 5.0%C. 6.0%D. 0.5%
Question 5
The labour force is 500 000 and 30 000 are unemployed. What is the unemployment rate?
A. 30.0%B. 16.7%C. 6.0%D. 3.0%
Question 6
The banking system receives $1 000 of new deposits and the required reserve ratio is 20%. What is the maximum possible money supply?
A. 1 200B. 2 000C. 5 000D. 20 000
Question 7
If the marginal propensity to consume is 0.8, what is the simple multiplier?
A. 1.25B. 8C. 2D. 5
Question 8
Which of the following is a progressive tax?
A. A tax levied only on consumptionB. The average tax rate falls as income risesC. The higher the taxable income, the higher the average tax rateD. Everyone pays the same amount
Question 9
If US$1 = HK$7.8, how many Hong Kong dollars is US$100 worth?
A. HK$78B. HK$780C. HK$700D. HK$870
Question 10
Exports are 15 billion and imports 10 billion. What is the trade balance?
A. Trade deficit of $25 billionB. Trade surplus of $5 billionC. Trade deficit of $5 billionD. Trade surplus of $25 billion
Question 11
If demand is elastic (elasticity greater than 1), what happens to total revenue when the price falls?
A. UnchangedB. First rises then fallsC. FallsD. Rises
Question 12
A government sets a price ceiling below the equilibrium price. What results?
A. SurplusB. ShortageC. EquilibriumD. Decrease in demand
Question 13
Which is a feature of perfect competition?
A. Firms are price takers and products are homogeneousB. High barriers to market entryC. Products are differentiated and firms can set prices freelyD. Only one seller
Question 14
Which central bank function relates directly to controlling the money supply?
A. Setting a minimum wageB. Adjusting the required reserve ratioC. Issuing identity cardsD. Levying profits tax
Question 15
Country A needs 2 hours to make a unit of cloth and country B needs 4 hours. According to comparative advantage, country A should do what?
A. Stop producing clothesB. Produce only the quantity it needsC. Specialise in producing clothes and trade with Country BD. Raise the price of clothes
Question 16
If supply is unchanged and demand rises, what happens to equilibrium price and quantity?
A. Both riseB. Both remain unchangedC. Price rises and quantity fallsD. Price falls and quantity rises
Question 17
If income is fixed at $10 000 and inflation is 5%, what is the real purchasing power?
A. $9 523.8B. $10 500C. $9 500D. $12 000
Question 18
GDP is 1 350 billion and the population is 7 500 000. Find GDP per capita.
A. $18 000B. $1 800C. $180 000D. $1 350 000
Question 19
A price floor set above the equilibrium (for example a minimum wage) leads to what?
A. Excess supply (appears as unemployment in the labour market)B. Increase in demandC. Equilibrium price fallsD. Supply shortage
Question 20
How does an increase in demand differ from a movement along the demand curve?
A. An increase in demand is caused by a change in priceB. An increase in demand is a rightward shift of the entire curve; movement along the curve is caused only by a change in the price of that goodC. The two are the sameD. Movement along the curve is caused by a change in income
Where are the answers, and is there an explanation?
Direct answer: each question is followed by an answer-and-explanation block giving the correct option, its value and the reason (elasticity: 20% ÷ 20% = 1), so you can tag each error as conceptual or arithmetic.
Answers and explanations
Question 1
Answer: A (1) Elasticity = % change in quantity ÷ % change in price = 20 ÷ 20 = 1.
Question 2
Answer: B ($800) Opportunity cost is the highest-valued alternative forgone: $800.
Question 3
Answer: D (1 350) GDP = C + I + G + (X − M) = 800 + 200 + 300 + 50.
Question 4
Answer: B (5.0%) Inflation = (126 − 120) ÷ 120 × 100%.
Question 5
Answer: C (6.0%) Unemployment rate = unemployed ÷ labour force × 100%.
Question 6
Answer: C (5 000) The deposit multiplier is 1 ÷ 0.2 = 5, so the money supply is 1 000 × 5.
Question 7
Answer: D (5) Multiplier = 1 ÷ (1 − MPC) = 1 ÷ 0.2.
Question 8
Answer: C (The higher the taxable income, the higher the average tax rate) A progressive tax has a rising average rate; a regressive one falls as income rises.
Question 9
Answer: B (HK$780) 100 × 7.8 = 780.
Question 10
Answer: B (Trade surplus of $5 billion) Net exports = 150 − 100 = 50, a surplus.
Question 11
Answer: D (Rises) When elasticity exceeds 1 the quantity rises proportionally more than the price falls, so total revenue rises.
Question 12
Answer: B (Shortage) Below equilibrium, quantity demanded exceeds quantity supplied, creating a shortage (queues or black markets).
Question 13
Answer: A (Firms are price takers and products are homogeneous) Many firms, a homogeneous product, full information and free entry mean each firm takes the market price.
Question 14
Answer: B (Adjusting the required reserve ratio) Reserve requirements, the discount rate and open-market operations move the money supply; taxes and minimum wages are government policy.
Question 15
Answer: C (Specialise in producing clothes and trade with Country B) A has the lower opportunity cost in cloth, so specialising and trading benefits both.
Question 16
Answer: A (Both rise) Demand shifts right, so equilibrium price and quantity both rise.
Question 17
Answer: A ($9 523.8) Purchasing power = 10 000 ÷ 1.05 = 9 523.8, a loss of about $476.
Question 18
Answer: C ($180 000) 1 350 × 10⁹ ÷ 7.5 × 10⁶ = 180 000.
Question 19
Answer: A (Excess supply (appears as unemployment in the labour market)) Above equilibrium, quantity supplied exceeds quantity demanded, creating a surplus.
Question 20
Answer: B (An increase in demand is a rightward shift of the entire curve; movement along the curve is caused only by a change in the price of that good) Non-price factors shift the curve; the good’s own price moves us along the same curve.
Where are Paper 1 marks most easily lost?
Direct answer: skipping the calculation items (elasticity, GDP and the multiplier are the easiest marks), confusing stocks with flows (money supply counts currency held by the public plus deposits), and confusing a shift of demand with a movement along the curve.
Where these marks are usually lost
| Mistake | What it looks like | What it costs | Instead |
|---|---|---|---|
| Memorising without calculating | Skipping elasticity, GDP or multiplier items | Those are the easiest marks on the paper | Turn each into a fixed formula and check it |
| Mixing stocks and flows | Counting everything as money supply | Money supply covers currency held by the public plus deposits | Fix the definition before answering |
| Ignoring ceteris paribus | Confusing a shift of demand with a movement along it | They are different concepts with different causes | Decide which curve moves first |
How to use this paper
First sit: no references, the full 60 minutes.
Mark it: split errors into concept and calculation, and rewrite the steps for every calculation error.
Second sit: finish inside 45 minutes with every calculation correct.
What should I do after this paper?
Direct answer: turn every calculation into a fixed formula (elasticity, GDP, money supply, multiplier, unemployment rate, inflation); drill past-paper questions by topic; then redo this paper inside 45 minutes with all calculations correct.
FAQ
Is this an HKEAA paper?
No. The questions and answers are TutorZone originals; only the framework figures (30%, 1 hour, Paper 2 at 26/35/9) come from the HKEAA 2027 assessment framework.
Does Economics have SBA?
No. The whole subject mark comes from Paper 1 (30%) and Paper 2 (70%).
How many questions are in Paper 1?
HKEAA publishes no fixed count; this paper sets 20 items as a practice set.
Official references
| Resource | What to check |
|---|---|
| HKEAA 2027 HKDSE Economics Assessment Framework | Confirm Paper 1’s 30% in 1 hour and Paper 2 at 26/35/9 |
| https://www.tutorzone.com.hk/en-dse-economics-paper-1-2-drill-guide/ | Papers 1 and 2 drilling guide |
| https://www.tutorzone.com.hk/en-dse-economics-past-paper-drill-guide/ | The full Economics drilling guide |
Related: practice area · papers 1 and 2 guide · BAFS Paper 1 mock
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