EconomicsCode 9708
Differing objectives and policies of firms
What this topic asks you to be able to do
- the traditional aim of firms: maximising profit
- a grasp of the further aims firms may pursue: survival; profit satisficing; sales maximisation; revenue maximisation
- price discrimination of the first, second and third degree: the circumstances needed for price discrimination to succeed; the outcomes that follow from price discrimination
- additional approaches to setting prices: limit pricing; predatory pricing; price leadership
- how price elasticity of demand links to a firm's revenue: along a standard downward-sloping demand curve; along a kinked demand curve