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Northern IrelandEconomics

A2 1: Business Economics

5 dot points across 5 inquiry questions. Click any dot point for a focused answer with worked past exam questions where available.

Why and how do firms grow, and what objectives do they pursue beyond profit?

The objectives of firms, organic growth, mergers and takeovers, integration, the survival of small firms, and the reasons firms demerge.
A focused CCEA A-Level Economics answer on business growth and objectives, covering profit, sales and revenue maximisation, satisficing and managerial objectives, organic growth, horizontal, vertical and conglomerate integration, mergers and takeovers, the survival of small firms, and demergers, with a worked integration analysis.
10 min answer →

How do a firm's costs, revenues and profits behave in the short run and the long run?

Short-run and long-run costs, the law of diminishing returns, economies and diseconomies of scale, revenue concepts, and profit maximisation.
A focused CCEA A-Level Economics answer on costs, revenue and profit, covering fixed and variable costs, marginal and average cost, the law of diminishing returns, economies and diseconomies of scale, total, average and marginal revenue, normal and supernormal profit, and the MC equals MR profit-maximising rule, with a worked calculation.
11 min answer →

How do firms behave in the real-world structures between the two extremes, and how do they compete without price?

Monopolistic competition and oligopoly, interdependence and collusion, game theory, non-price competition, and price discrimination.
A focused CCEA A-Level Economics answer on imperfect competition, covering monopolistic competition and its long-run normal profit, oligopoly and concentration, interdependence, collusion and cartels, game theory and the prisoner's dilemma, non-price competition, and the conditions for price discrimination, with worked game-theory reasoning.
11 min answer →

How do firms behave at the two extremes of market structure, and which is more efficient?

The assumptions and outcomes of perfect competition and monopoly, the short-run and long-run equilibrium of each, and a comparison of their efficiency.
A focused CCEA A-Level Economics answer on perfect competition and monopoly, covering the assumptions of each, short-run and long-run equilibrium, the role of entry and exit, the sources of monopoly power, and a comparison of allocative and productive efficiency, with worked equilibrium reasoning.
11 min answer →

How are wages determined in a labour market, and why do they differ between groups?

The demand for and supply of labour, wage determination in competitive labour markets, the effects of trade unions and monopsony, and labour market failure.
A focused CCEA A-Level Economics answer on the labour market, covering the derived demand for labour and marginal revenue product, the supply of labour, wage determination in a competitive market, the effects of trade unions, monopsony employers and the minimum wage, and labour market failure, with worked wage analysis.
11 min answer →