A small bakery specializes in selling organic sourdough loaves. The bakery sells 300 loaves of sourdough each week; its weekly total costs are £1,200, which includes £600 of fixed costs. The bread is sold at £5 a loaf. A competitor nearby closes down and the bakery's weekly sales increase to 400 loaves. Other things remaining the same, profit per week increases by:
£100
£200
£300
£500
156 exam-style questions on AQA A Level Economics 1.4 Production, costs and revenue, covering 1.4.1 Production and productivity, 1.4.2 Specialisation, division of labour and exchange, 1.4.3 The law of diminishing returns and returns to scale (A-level only), 1.4.4 Costs of production, 1.4.5 Economies and diseconomies of scale, 1.4.6 Marginal, average and total revenue, 1.4.7 Profit, and 1.4.8 Technological change (A-level only). Each one has a worked solution and a mark scheme showing where the marks go.