Cambridge AS & A Level Economics
7.8Differing objectives and policies of firms
Differing objectives and policies of firms in Cambridge AS & A Level Economics: what the syllabus expects you to know, the learning objectives and how to practise.
Subtopic45 practice questions2 lessons
Overview
The principal-agent problem (7.7.5) is taught in the objectives lesson covered here.
Learning objectives
What the syllabus expects you to be able to do.
- 7.8.1Explain the traditional profit-maximising objective.
- 7.8.2Explain other objectives: survival, profit satisficing, sales maximisation and revenue maximisation.
- 7.8.3Explain first-, second- and third-degree price discrimination, the conditions for it and its consequences.
- 7.8.4Explain other pricing policies: limit pricing, predatory pricing and price leadership.
- 7.8.5Explain the relationship between PED and a firm's revenue, for a normal and a kinked demand curve.
Lessons
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Objectives of firms
40 min
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Price discrimination
45 min
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Sample question
A sample question on this topic. Answer it, check it, then read the worked answer.
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