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A2 OCR Economics F583 2016

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Original post by SilverHorsey
it depends what definition of monopoly youre using, and as the question didnt state it being a pure monopoly you can just as well write for an ao2 point even that in the context of legal/dominant monopolies (25% and 40% of MS respectively) etc etc.


I don't remember them giving you percentage shares for these firms. Do you think I'd get any marks for saying that one of them was dominant (over40) and 2 of them were legal (over 25) which dominate and then the small firms? I remember my teacher said that I could write bs, but how true is it?
Original post by qwertypoiop
I don't remember them giving you percentage shares for these firms. Do you think I'd get any marks for saying that one of them was dominant (over40) and 2 of them were legal (over 25) which dominate and then the small firms? I remember my teacher said that I could write bs, but how true is it?


You might im not sure, I just assumed that they would both at least have over 25% of the market share so said they were both legal monopolies (ive looked for some actual figures but couldnt find anything)

Im not sure I wouldnt recommend anyone to write bull sh i t in an exam, I blag a lot in exams because I dont revise but wouldnt recommend what your teacher said
(edited 7 years ago)
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Poll on the grade boundaries?
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Original post by kamez
hi, guys, how was your paper? i hope it is 51 for an A* and not more :frown:

it was a predictable question 4 part a and b. they were easy 35 marks which everyone should have attempted! it was a weirdly structured paper as it was a mix of sports and broadcasting, and i don't believe that they have adopted a similar type before.

what do you think the grade boundaries shall be for an A?


Around 48 for the A* & 41 for an A. i know a lot of people that had trouble time keeping (therefore capped essays).
For the MC and MR question I just talked about how profit max is when they are equal to each other and when MC is greater there will be no profit being made.
Is this wrong?
Original post by Rk2k14
For the MC and MR question I just talked about how profit max is when they are equal to each other and when MC is greater there will be no profit being made.
Is this wrong?


No this isn't wrong. Profit Maximisation at MR=MC. If MC>MR, then profit is falling, if MR>MC then profits are rising.

Actually if MC>MR, then the company isn't making profits, they are spending more than they are bringing in.
Original post by Fas
No this isn't wrong. Profit Maximisation at MR=MC. If MC>MR, then profit is falling, if MR>MC then profits are rising.

Actually if MC>MR, then the company isn't making profits, they are spending more than they are bringing in.


Thanks.

Thought the 15 marker was pretty tough, given that you can only take about so much.

20 makers was much better.
Original post by Fas
No this isn't wrong. Profit Maximisation at MR=MC. If MC>MR, then profit is falling, if MR>MC then profits are rising.

Actually if MC>MR, then the company isn't making profits, they are spending more than they are bringing in.


My teacher was **** scared after realising this question came up since he only taught us that where MR=MC profit is maximised. Do you think I will get any marks for explaining that at MR=MC difference between costs and revenue is the greatest, and drawing a diagram? I then shifted MC to the point where only normal profits are made.
Original post by qwertypoiop
My teacher was **** scared after realising this question came up since he only taught us that where MR=MC profit is maximised. Do you think I will get any marks for explaining that at MR=MC difference between costs and revenue is the greatest, and drawing a diagram? I then shifted MC to the point where only normal profits are made.


I think you meant shifting AC, shifting MC will change the profit maximising equilibrium but not necessarily make normal profits.
Original post by keynes24
I think you meant shifting AC, shifting MC will change the profit maximising equilibrium but not necessarily make normal profits.


I shifted them both, because it's the only thing we've been taught and I know it's not right. But, would I get at least some marks for drawing a profits diagram and explaining about costs and revenues?
Original post by qwertypoiop
My teacher was **** scared after realising this question came up since he only taught us that where MR=MC profit is maximised. Do you think I will get any marks for explaining that at MR=MC difference between costs and revenue is the greatest, and drawing a diagram? I then shifted MC to the point where only normal profits are made.


I didn't sit this exam haha, I did this exam about 2 years ago and got 92, so was just bored and decided to sort some guy's queries out :P

As for your question, you should be fine. As long as your diagram wasn't wrong, it should be ok.

"I shifted MC to the point where only normal profits are made" what do you mean by this? Profits are made when MR=MC or MR>MC, profit is maxed at the first level.
Original post by Rk2k14
Thanks.

Thought the 15 marker was pretty tough, given that you can only take about so much.

20 makers was much better.


Didn't sit this exam I'm afraid, I did this exam a couple of years ago. What were the 15 and 20 markers?
Original post by Fas
I didn't sit this exam haha, I did this exam about 2 years ago and got 92, so was just bored and decided to sort some guy's queries out :P

As for your question, you should be fine. As long as your diagram wasn't wrong, it should be ok.

"I shifted MC to the point where only normal profits are made" what do you mean by this? Profits are made when MR=MC or MR>MC, profit is maxed at the first level.


That is not quite right, profit maximisation takes place where MR=MC, profits will take place where Price or AR is greater than AC. MR>MC only indicates that profits are rising or loses are decreasing.
Original post by keynes24
That is not quite right, profit maximisation takes place where MR=MC, profits will take place where Price or AR is greater than AC. MR>MC only indicates that profits are rising or loses are decreasing.


Isn't that exactly what I said?
Original post by Fas
Isn't that exactly what I said?


Not really. Profits are made when MR=MC , you don't need to profit maximize to make profits, a firms maximizing revenue could still make some supernormal profits.
Original post by keynes24
Not really. Profits are made when MR=MC , you don't need to profit maximize to make profits, a firms maximizing revenue could still make some supernormal profits.


No I said thats just a profit max point. I said too that profits are also being produced at MR > MC.

Yeah supernormal profits require a firm to have monopoly power. It can happen in perfect and monopolistic competition too, but only in the short run (after firms see the supernormal profits they will enter the market and force the price down).

Im not sure if whether you made a mistake or you were making a valid point and I have missed it, but Revenue Maximisation does not equal Profit Maximisation.
Original post by Fas
No I said thats just a profit max point. I said too that profits are also being produced at MR > MC.

Yeah supernormal profits require a firm to have monopoly power. It can happen in perfect and monopolistic competition too, but only in the short run (after firms see the supernormal profits they will enter the market and force the price down).

Im not sure if whether you made a mistake or you were making a valid point and I have missed it, but Revenue Maximisation does not equal Profit Maximisation.


Just picked your comment of profits not profit maximisation.
Profits are made when MR=MC or MR>MC, profit is maxed at the first level.

When MR>MC it indicates profits are rising or loses are falling. A firm could be making a loss where MR>MC but experience a fall in their loses. Revenue maximisation is different from Profit maximisation but I based my comment on profits made as you indicated above.

Going back to the actual question: How the profit earned by a firm is influenced by the relationship between it's marginal cost and marginal revenue.
I think that Low level 2 will be the diagram showing profit maximisation. To reach L3 you would probably need to introduce marginal analysis, when MR>MC profits are rising, MR=MC profits are at the highest, when MR<MC profits are falling.
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Original post by keynes24
Just picked your comment of profits not profit maximisation.
Profits are made when MR=MC or MR>MC, profit is maxed at the first level.

When MR>MC it indicates profits are rising or loses are falling. A firm could be making a loss where MR>MC but experience a fall in their loses. Revenue maximisation is different from Profit maximisation but I based my comment on profits made as you indicated above.

Going back to the actual question: How the profit earned by a firm is influenced by the relationship between it's marginal cost and marginal revenue.
I think that Low level 2 will be the diagram showing profit maximisation. To reach L3 you would probably need to introduce marginal analysis, when MR>MC profits are rising, MR=MC profits are at the highest, when MR<MC profits are falling.


why did you people do profit max question rather than market failure which was rather simple and required general knowledge or AS knowledge with some keywords from A2....that was a solid essay where one can gain 30/35 with ease. part a and b included
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Original post by xs4
Around 48 for the A* & 41 for an A. i know a lot of people that had trouble time keeping (therefore capped essays).


what why?? why so low for an A*?!?!? wasn't it like 46 for an A last year? are you sure???
Original post by kamez
why did you people do profit max question rather than market failure which was rather simple and required general knowledge or AS knowledge with some keywords from A2....that was a solid essay where one can gain 30/35 with ease. part a and b included


I didn't do the paper and different students find different parts of the syllabus easier. To get high marks on question 4 it requires more than just a few keywords from A2 but if you find policies easy then it was a good choice for you.

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