Question 15 - 2281/12/O/N/24 | mMCQ.me

mMCQ.

Navigation Menu

Step into mMCQ.

Launch mMCQ. diagnostic

Explore mMCQ.

Cambridge A Levels Cambridge O Levels Free Diagnostic Pricing & Subscribe Sign in

Resources

Terms & Conditions

mMCQ.

© 2021 - 2025 mMCQ.All rights reserved.

Question 15 - 2281/12/O/N/24 | mMCQ.me

O Levels Economics (2281)•2281/12/O/N/24

Question 15 from 2281/12/O/N/24

Explanation

Average revenue equals price and determines total revenue via quantity.

Steps:

Average revenue (AR) is total revenue (TR) divided by quantity sold (Q): AR = TR / Q.
Given AR = $20 and Q = 1000 units.
Solve for TR: TR = AR × Q = 20 × 1000 = $2000.
Price (P) equals AR in competitive markets, so P = $20.

Why C is correct:

TR = AR × Q gives $2000, and P = AR by definition in economics.

Why the others are wrong:

A: TR is $20 (ignores multiplication by Q); price$ 50 mismatches AR.
B: TR is $1000 (w r o n g c a l c u l a t$ 50 mismatches AR.

Final answer: C

Topic: Firms' costs, revenue and objectives

Practice more O Levels Economics (2281) questions on mMCQ.me

i

o

n

)

;

p

r

i

c

e

1000 (wrong calculation); price

1000 (w ro n g c a l c u l a t i o n); p r i ce

D: TR is

20,000 (multiplies AR by 1000 incorrectly as 20 × 1000 × 10); price

50 mismatches AR.