CAIE IGCSE Economics 3.6.5 Objectives of Firms Questions

Practise Cambridge IGCSE Economics by identifying firm objectives, calculating profit from revenue and cost data and selecting the output that maximises profit.

Exam points

Identify a firm objective from its circumstances, distinguishing profit maximisation, survival, growth, efficiency and social welfare.
Calculate profit as total revenue minus total cost and compare outcomes across output levels.
Locate the output that maximises profit from a total-revenue/total-cost table or a profit schedule.

[Maximum number: 1]

What is the definition of profit maximisation?

The firm is allocating a proportion of profit to other business objectives.

The firm is making as much profit as possible.

The firm is making higher levels of profit this year than last year.

The firm is making the same amount of profit this year as last year.

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CAIE IGCSE Economics 3.6.5 Objectives of Firms Questions question 1