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Edexcel IAL Economics 3.3.1.3c formulae for business objectives

Practise business-objective formulae by matching MR = MC, MR = 0 or AR = AC conditions to firm objectives in diagram or scenario questions.

Syllabus
First assessment 2019
Course
Economics YEC11
Level
A2

Exam points

  • Match MR = MC, MR = 0 or AR = AC to the objective shown in the scenario.
  • Use cost and revenue conditions to identify sales maximisation without a loss.

3.3.1.3c - Formulae for different business objectives: • profit maximisation • revenue question 1

[Maximum number: 1]

Mara Phone is a new smartphone developed by the African conglomerate, Mara Group. The business is aiming to grow its market share by maximising its sales.

Which one of the following conditions is necessary for Mara Group to maximise sales volume of this new phone without making a loss?

A

Marginal revenue equals marginal cost

B

Average revenue equals average cost

C

Marginal revenue equals zero

D

Average revenue equals marginal revenue

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