Lesson 3.3.1
3.3.1 Revenue Quiz: Pearson Edexcel Economics, Unit 3
20 questions
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Lesson 3.3.1, Revenue: 20 multiple choice questions for the Pearson Edexcel Economics (9EC0), Unit 3: Theme 3: Business behaviour and the labour market, written with Revision Ninja.
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The 20 questions
-
What is the formula used to calculate total revenue?
- Price + quantity
- Price × quantity
- Price ÷ quantity
- Profit × quantity
-
Average revenue is always equal to which economic measure?
- Price
- Total revenue
- Average cost
- Marginal revenue
-
What is the additional revenue generated from selling one extra unit of output?
- Total revenue
- Marginal revenue
- Average revenue
- Marginal profit
-
What is the value of price elasticity of demand when demand is price elastic?
- Equal to 1
- Greater than 1
- Less than 1
- Equal to 0
-
If price falls by 10% and quantity demanded rises by 20%, what is the price elasticity of demand?
- -20.0
- -0.5
- -2.0
- -1.0
-
Total revenue is £2,400 when 60 units are sold. What is average revenue?
- £4
- £60
- £40
- £144,000
-
Price is £4 and 250 units are sold. What is total revenue?
- £1,250
- £1,000
- £62.50
- £254
-
Total revenue rises from £600 to £660 when output rises from 30 to 31 units. What is the marginal revenue of the 31st unit?
- £22
- £20
- £60
- £630
-
At 40 units, total revenue is £800. What is average revenue?
- £40
- £32,000
- £20
- £200
-
If price elasticity of demand is -2, what happens to quantity demanded when price rises by 5%?
- Falls by 2.5%
- Rises by 10%
- Falls by 10%
- Rises by 2.5%
-
What happens to total revenue when a firm increases price on a product with inelastic demand?
- It increases
- It decreases
- It remains unchanged
- It falls to zero
-
What happens to total revenue when a firm reduces price on a product with elastic demand?
- It falls to zero
- It remains unchanged
- It decreases
- It increases
-
At what value of marginal revenue is total revenue at its maximum?
- Zero
- Negative
- Equal to price
- Positive
-
A firm faces a price elasticity of demand of -0.5. How can it increase total revenue?
- Decrease price
- Increase output
- Keep price constant
- Increase price
-
Where does marginal revenue lie relative to average revenue on a downward-sloping demand curve?
- Above average revenue
- Below average revenue
- Equal to average revenue
- Parallel to average cost
-
Demand is P = 60 - 2Q. At which output is total revenue maximised?
- Q = 30
- Q = 20
- Q = 15
- Q = 7.5
-
Using the same demand curve P = 60 - 2Q, what is the maximum total revenue?
- £225
- £900
- £600
- £450
-
Under what demand condition does a price cut increase total revenue?
- Unit elastic demand
- Perfectly inelastic demand
- Inelastic demand
- Elastic demand
-
Price falls from £10 to £8 and quantity rises from 100 to 130. What happens to total revenue?
- Rises by £300
- Falls by £200
- Falls by £40
- Rises by £40
-
Why might a firm facing elastic demand avoid cutting its price despite potential revenue gains?
- Instantaneous cost reduction
- Zero marginal costs
- Risk of price wars
- Guaranteed monopoly profits
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