Economics Tutoring in Hong Kong

Score an A* for your A-Levels or IB econ exam!

Most of my students HATED econ when they first started...

Yet, they ended up with a much better grade than they could ever expect.

Some even with an A*.

How?

Well, first of all, my name is Ismail and I've helped over 30 students individually succeed in econ.

I hold a Bachelor in Applied Economics from HKBU and was ranked 10th nationally on the Economics side in the A-Level Cambridge International Examinations of Mauritius in 2018.

I help my students succeed in 2 ways:

1. Grasp the fundamentals of Econ at an intuitive level
2. Learn the proper exam techniques.

I can travel anywhere in HK and also provide online classes.

PM or WhatsApp 9137 5353 for more details.

The candy bar lesson on supply and demand

Imagine you're selling candy bars at school.

You have 10 bars and price them at $10 each.

Only 2 students buy them.

The next day, you lower the price to $5. Now 5 students buy them.

On the third day, you lower it to $2. All 10 sell quickly.

This is the Law of Demand in action: when price goes down, more people want to buy.

Now imagine your candy bars become famous.

Every student wants one, but you still only have 10 bars.

You can raise the price to $15 and still sell out.

This is the Law of Supply: when something is scarce and many people want it, the price can go up.

Together, these forces find the "sweet spot" price where the number of candy bars you have matches the number of students willing to pay for them.

PPC SIMPLY explained with a student's weekend

Imagine you have a big weekend ahead.

You need to split your time between studying for Economics and studying for History.

If you spend your whole weekend on Economics, you could master 5 chapters.

If you spend it all on History, you could master 4 chapters.

But you're smart, so you'll mix it up.

Option A: 5 Econ chapters, 0 History chapters

Option B: 4 Econ chapters, 1 History chapter

Option C: 3 Econ chapters, 2 History chapters

Option D: 2 Econ chapters, 3 History chapters

Option E: 0 Econ chapters, 4 History chapters

Notice something?

To get that first History chapter, you only gave up 1 Econ chapter.

But to get your fourth History chapter, you'd have to give up 2 full Econ chapters!

The trade-off gets steeper.

This is the production possibility curve (PPC).

It shows the maximum you can produce with limited resources (your weekend time).

Every choice has an opportunity cost.

In other words, the Econ chapters you give up to study History.

The curve is bowed out because resources (your energy and focus) aren't perfectly adaptable.

The more you specialize in one subject, the harder it becomes to keep gaining in the other without big sacrifices.

This simple model explains everything from a student's weekend to a country's choice between building roads or hospitals.

Fixed costs and variable costs explained SIMPLY.

Let's open a small pop-up coffee stand in Central.

Some costs stay the same no matter how many coffees we sell.

We have to pay $5,000 for the stall rental.

This is our Fixed Cost. It's fixed because it doesn't change if we sell 10 coffees or 100....

..or 0. No matter what, we MUST pay the cost.

Other costs change with every sale.

Each coffee needs $10 for beans, milk, and a cup. This is our Variable Cost.

If we sell 10 coffees, this costs us $100. If we sell 100, it's $1,000.

So total cost is just: fixed costs + variable costs.

If our fixed cost is $5,000 and our variable cost for 100 coffees is $1,000, our total cost is $6,000.

To be profitable, the price of our coffee must cover the variable cost first ($10), and then help pay off that big fixed cost.

This is why new businesses can struggle at first.

They have to sell a lot just to cover their fixed costs, which is why understanding this difference is so crucial in economics.

Amazing to see students succeed, especially when they "hate" the subject 🙂

Econ can be a tricky subject to get around but with clear understanding + guidelines on how to tackle exam questions, what seemed to be such a daunting subject becomes quite enjoyable!

What the heck is Market Failure? (It's simpler than you think)

Alright, let's break down Market Failure.

It sounds complicated, but you see it all the time in Hong Kong.

Basically, Market Failure is when companies and consumers, just doing their own thing, accidentally create a bad result for everyone else.

Think about a factory in Kwun Tong making cheap goods.

The buyer gets a low price, the factory makes money. The market seems happy.

But what if that factory's smoke is making the air dirty for the whole neighborhood?

The factory doesn't pay for the smog, and you don't pay for it at the checkout.

The people breathing the air pay the real price.

That's Market Failure.

The price tag on the product lied.It didn't include the hidden cost we all have to cover.

Other examples:

Traffic jams: You driving your car seems like a simple choice. But when everyone does it, we get gridlock. Your personal choice creates a cost for all other drivers.

Underpaid security guards: They protect a whole building, but their salary doesn't reflect the full value and safety they provide to every single resident.

For your IB or A-Level exams, you just need to spot these situations in real-life articles, draw the simple diagram (showing that hidden cost), and suggest how the government could fix it (like a tax or a rule).

IB Economics IA Help

--> A Simple Guide to Choosing the Right Article.

Struggling to start your IB Economics Internal Assessment (IA)?

The most common hurdle is picking a suitable article.

Many students in Hong Kong choose an article that is too broad or doesn't link clearly to a specific key concept.

This makes your analysis difficult from the very first step.

Here is a simple, 3-part checklist to find a perfect IA article:

1. It must be about a specific economic event or policy.

"Hong Kong's 2024 Stamp Duty Reversal for Property Transactions" or "Rising Air Freight Costs Due to Red Sea Disruptions." (GOOD)

"An Overview of Global Inflation." (BAD)

2. It must clearly relate to ONE of the 9 IB key concepts.

Scarcity, Choice, Efficiency, Equity, Economic Well-Being, Sustainability, Change, Interdependence, Intervention.

Ask yourself: "Which concept is at the heart of this story?" If you can't answer instantly, find a new article.

3. The diagram must be obvious to you.

Before you commit, know if you'll need a Supply & Demand diagram, a Market Failure diagram, or a Macro diagram.

If the link to a core diagram isn't clear, the article will be a constant struggle.

Why this works for your IA:

A well-chosen article does half the work for you.

It provides a clear path for your commentary, making it easier to apply terminology and build a focused analysis.

If you're an IB student in Hong Kong looking for more structured help with your IA, microeconomics, or macroeconomics, feel free to send me a message.

Externalities Explained with a Loud Speaker.

You live in an apartment building.

Your neighbour, Alex, loves to play loud music late at night.

The Situation:

Alex enjoys the music. This is a private benefit.

You, however, lose sleep. This is a cost that you have to pay for his enjoyment.

This cost you experience—the lost sleep—is a Negative Externality.

It's a cost imposed on a third party who wasn't involved in the decision.

Now, imagine a different neighbour, Sam, decides to buy a very expensive, beautiful orchid for their balcony.

The New Situation:

Sam enjoys the flower. Private benefit.

But you, and everyone else who walks past, also get to enjoy the beautiful view.

You get a free dose of happiness.

This free benefit you experience is a Positive Externality.

It's a benefit enjoyed by a third party who didn't pay for it.

So what's the big deal?

Externalities lead to inefficient outcomes for society because the full cost or benefit isn't considered.

Without rules, there would be too much loud music (negative externality) because Alex doesn't pay for your lost sleep.

Without incentive, there might be too few beautiful balcony gardens (positive externality) because Sam bears the full cost but doesn't capture all the beauty-benefits for the neighbourhood.

This is why governments step in:

They tax or fine activities with negative externalities (like noise pollution fines).

They subsidize or support activities with positive externalities (like giving tax breaks for installing solar panels that reduce pollution for everyone).

An externality is simply a side effect of an activity that affects the well-being of bystanders.

Supply and Demand SIMPLY Explained with Limited Edition Sneakers.

Imagine a new, must-have pair of sneakers just dropped. Only 100 pairs were released in Hong Kong.

The Demand: Thousands of sneakerheads want them! Because so many people want them but there are very few pairs, people are willing to pay a lot. This is High Demand.

Now, let's look at two scenarios:

Scenario 1: High Price

The store prices them at a crazy $5,000 per pair. At this price, only a few hardcore collectors can afford them. The store might only sell 20 pairs. This leaves 80 pairs sitting on the shelf.

Scenario 2: Low Price

The store prices them at $100. At this amazing price, thousands of people rush to buy them, but there are still only 100 pairs. The store sells out in seconds, and thousands of customers leave disappointed and empty-handed.

So, what's the right price?

This is where Supply (the limited 100 pairs) and Demand (the thousands of want) meet.

The perfect price is the one where the number of people willing to pay matches the number of pairs available.

Let's say that price is $800. At $800, there are exactly 100 people ready to buy.

The store sells all its pairs, and everyone who was willing to pay that price gets one.

The Invisible Hand:

When you see the resell price of sneakers going up, it's because demand is higher than supply.

When you see a shop having a sale, it's often because supply is higher than demand. They have too much stock and need to lower the price to make people want to buy.

This balance between what's available (Supply) and how many people want it (Demand) is what decides the price of almost everything around you.

Send a message to learn more

Inflation SIMPLY Explained with Your $50 Pocket Money.

Imagine your grandma gives you $50 for your birthday.

With that $50, you have a plan:

You can buy 10 comic books that cost $5 each. Perfect!

But... you decide to save the money for six months.

When you take the same $50 out of your piggy bank six months later, you go to the store and find something has changed.

The comic books now cost $6 each.

Your $50 doesn't disappear.

It's still a $50 note.

But what it can buy has shrunk. Now, you can only afford 8 comic books.

That is inflation.

It's not just that things are getting more expensive.

It's that the purchasing power of your money is getting weaker.

Each dollar you have buys a little bit less than it did before.

Why does this happen?

It's usually because there's too much money chasing too few goods.

If everyone has a lot of money to spend (like your whole class gets a big allowance), but the number of comic books in the store stays the same, the shopkeeper can raise the price because people are still willing to pay.

So, inflation is the reason your parents say, "A bowl of wonton noodles used to cost $10 when I was your age!"

It's not a myth. It's the slow, silent shrinker of your pocket money's power.

Comparative Advantage & Trade Explained SIMPLY.

Imagine two students, Anna and Ben, studying for a test. They have one hour.

In one hour:

Anna can solve 20 Math problems OR write 10 History essay points.

Ben can solve 10 Math problems OR write 5 History essay points.

At first glance, Anna is better at both tasks. She has an Absolute Advantage.

But let's look at their opportunity costs – what they give up to do one task over the other.

Anna's Opportunity Cost:

To solve 20 Math problems, she gives up writing 10 History points.

So, 1 Math problem costs her 0.5 History points.

To write 10 History points, she gives up 20 Math problems.

So, 1 History point costs her 2 Math problems.

Ben's Opportunity Cost:

To solve 10 Math problems, he gives up writing 5 History points.

So, 1 Math problem costs him 0.5 History points.

To write 5 History points, he gives up 10 Math problems.

So, 1 History point costs him 2 Math problems.

Wait!

Their opportunity costs are the same?

This is a special case where trade might not be beneficial. Let's change the example slightly.

New Scenario:

In one hour:

Anna can solve 20 Math problems OR write 15 History points.

Ben can solve 10 Math problems OR write 5 History points.

Anna's New Opportunity Cost:

1 Math problem = 0.75 History points

1 History point = 1.33 Math problems

Ben's New Opportunity Cost:

1 Math problem = 0.5 History points

1 History point = 2 Math problems

Now we see the difference!

Ben has a LOWER opportunity cost for Math (0.5 History points vs Anna's 0.75). He has the Comparative Advantage in Math.

Anna has a LOWER opportunity cost for History (1.33 Math problems vs Ben's 2). She has the Comparative Advantage in History.

The Magic of Trade:

If they specialize and trade:

Ben focuses ONLY on Math

Anna focuses ONLY on History

They can produce MORE total work together than if they both worked alone, and then trade points with each other to both have complete notes.

This is why countries trade!

Even if one country is better at producing everything, it pays to specialize in what you're relatively best at.

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