AQA A-level Economics (new spec) 2-05 Market Structures/Objectives of the Firm Revisited

This is a Powerpoint (and accompanying Notes/Key Terms sheet) that I created for my own teaching of the new (linear) AQA A-level Economics specification (7135). As I was also using the AQA-approved textbook (Powell & Powell, 2016) the two follow a similar route through the material.

Topics covered in this Powerpoint:
4.1.5.1 Market structures
• The spectrum of competition ranging from perfect competition at one end of the spectrum to pure monopoly at the other end of the spectrum.
• Factors such as the number of firms, the degree of product differentiation and ease of entry are used to distinguish between different market structures.

4.1.5.2 The objectives of firms
• The models that comprise the traditional theory of the firm are based upon the assumption that firms aim to maximise profits.
• The profit-maximising rule (MC=MR).
• The reasons for and the consequences of a divorce of ownership from control.
• Firms have a variety of other possible objectives.
• The satisficing principle.
• Students should recognise that firms have a range of possible objectives including survival, growth, quality, maximising their sales revenue and increasing their market share.
• Students should be able to discuss how the divorce of ownership from control may affect the objectives of firms, their conduct and performance.