Practise IB Economics HL 2.4.3 by explaining profit maximization, satisficing and alternative goals such as growth, market share and social responsibility with marked exam evidence.
Explain why some firms might choose the goal of profit maximization while others might choose to adopt satisficing behaviour.
Answers may include:
- definitions of profit maximization and satisficing
- diagram(s) to show MC = MR maximizes profit
- explanation of how profits are maximized when MR=MC and that satisficing behaviour can cover a range of objectives and also lead to outcomes that are less profitable
- examples of firms with different goals.
Assessment Criteria
Level ..... Marks
0 The work does not meet a standard described by the descriptors below. ..... 0
1 There is little understanding of the specific demands of the question. Relevant economic terms are not defined. There is very little knowledge of relevant economic theory. There are significant errors. ..... 1-3
2 There is some understanding of the specific demands of the question. Some relevant economic terms are defined. There is some knowledge of relevant economic theory. There are some errors. ..... 4-6
3 There is understanding of the specific demands of the question. Relevant economic terms are defined. Relevant economic theory is explained and applied. Where appropriate, diagrams are included and applied. Where appropriate, examples are used. There are few errors. ..... 7-8
4 There is understanding of the specific demands of the question. Relevant economic terms are clearly defined. Relevant economic theory is clearly explained and applied. Where appropriate, diagrams are included and applied effectively. Where appropriate, examples are used effectively. There are no significant errors. ..... 9-10