CAIE A-Level Economics 7.8.1 Profit maximisation

CAIE A-Level Economics 7.8.1 Profit maximisation
Cambridge International AS & A Level Economics 9708 syllabus for exams in 2026, 2027 and 20282026–2028

Practise finding the profit-maximising output from cost and revenue evidence and contrasting it with non-profit objectives.

How this is tested

  • select the output where MC equals MR on a firm's revenue and cost diagram

Question 8

[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 8 — CAIE A-Level Economics

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