Revenue maximisation
What Revenue maximisation means in Economics A-Level, as defined for AQA.
Definitions of Revenue maximisation
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Reference: AQA
Producing where marginal revenue is zero, an objective managers might pursue when their bonuses are tied to company size.
The point at which total revenue reaches its peak, achieved at the exact output level where marginal revenue equals zero.
Firms use price elasticity of demand estimates to set prices that maximise total revenue.
Topics that use Revenue maximisation
- Marginal, average and total revenue (AQA A-Level)
- Price, income and cross elasticities of demand (AQA A-Level)
- The objectives of firms (AQA A-Level)
Related terms
- Marginal revenue
- Profit maximisation
- Average revenue
- Bounded rationality
- Business objectives
- Corporate governance
- Corporate social responsibility
- Cross Elasticity of Demand (XED)
Using Revenue maximisation in the exam
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