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Question 18M.1.HL.TZ2.2a

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Date May 2018 Marks available [Maximum mark: 10] Reference code 18M.1.HL.TZ2.2a
Level HL Paper 1 Time zone TZ2
Command term Explain Question number a Adapted from N/A
a.
[Maximum mark: 10]
18M.1.HL.TZ2.2a
(a)

Explain why some firms might choose the goal of profit maximization while others might choose to adopt satisficing behaviour.

[10]

Markscheme

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.

Marks should be allocated according to the Paper 1 markbands for May 2013 forward, part A.

Syllabus sections