Economics (AS & A Level) · Oct / Nov 2021 · Paper 31 · Question 11

The diagram shows a firm's cost and revenue curves. The firm embarks on a single successful $100 million advertising campaign. How will this affect its costs and revenue curves?

1. AMR curve shifts to right, AR curve shifts to right, MC curve shifts up, AC curve unchanged
2. BMR curve shifts to right, AR curve shifts to right, MC curve unchanged, AC curve shifts up
3. CMR curve unchanged, AR curve unchanged, MC curve shifts up, AC curve unchanged
4. DMR curve unchanged, AR curve unchanged, MC curve unchanged, AC curve shifts up

As printed in the paper