CAIE A-Level Economics A2 7.8.1 Profit Maximisation Topic Practice

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Question 1

[Maximum number: 1]

In the diagram
M C= marginal cost; A C= average cost; M R= marginal revenue; A R= average revenue.

Figure for Question 1 — CAIE A-Level Economics A2

What will be the output of a profit-maximising firm whose cost and revenue functions are shown above?

A

OW

B

OX

C

OY

D

OZ

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