Economics A-Level
Profit motive
What Profit motive means in Economics A-Level, as defined for AQA.
Definitions of Profit motive
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Reference: AQA
The motivation that incentivises firms to minimise production costs by choosing efficient combinations of capital and labour.
The greater profit incentive for firms to expand production when higher prices are offered.
Topics that use Profit motive
- How markets and prices allocate resources (AQA A-Level)
- The determinants of the supply of goods and services (AQA A-Level)
Related terms
- Asymmetric information
- Average variable cost
- Ceteris paribus
- Economic efficiency
- Economic incentives
- Equity versus efficiency
- Equity vs efficiency
- Ethics in economics
Using Profit motive in the exam
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