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Cambridge IGCSE Economics practice

Paper 2 structured question: Firms’ costs, revenue and objectives

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Firms’ costs, revenue and objectives

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Paper 2Structured Questions4 marks

A factory has fixed costs of $400 and variable costs of $600 when producing 200 units.

Description

Cost Calculation

Determine the Average Fixed Cost (AFC) and Average Variable Cost (AVC) for the factory.

  1. a

    Calculate the Average Fixed Cost (AFC).

    Aim for approximately 2 distinct marking points.

    [2]
  2. b

    Calculate the Average Variable Cost (AVC).

    Aim for approximately 2 distinct marking points.

    [2]

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Paper 2 structured question: Firms’ costs, revenue and objectives

Paper 2Structured Questions4 marks

Description

Production Costs Analysis

Calculate the Total Cost (TC), Average Total Cost (ATC), Average Fixed Cost (AFC), and Average Variable Cost (AVC) for the company.

  1. a

    Calculate the Total Cost (TC) of production.

    Aim for approximately 2 distinct marking points.

    [2]
  2. b

    Calculate the Average Total Cost (ATC) of production.

    Aim for approximately 2 distinct marking points.

    [2]