AP Microeconomics

By taking on the role of a leader at a fictitious company, you will learn fundamental economic concepts, including scarcity, opportunity costs and trade-offs, productivity, economic systems and institutions, exchange, money, and interdependence.

Major Concepts:

Basic Economic Concepts

• Scarcity
• Resource Allocation and Economic Systems
• Production Possibilities Curve
• Comparitive Advantage and Trade
• Cost-Benefit Analysis
• Marginal Analysis and Consumer Choice

Supply and Demand

• Price Elasticity of Demand
• Price Elasticity of Supply
• Market Equilibrium and Consumer and Producer Surplus
• Market Disequilibrium and Changes in Equilibrium
• The Effects of Government Intervention in Markets
• International Trade and Public Policy

Production, Cost, and the Perfect Competition Model

• The Production Function
• Short-Run and Long-Run Production Costs
• Types of Profit
• Profit Maximization
• Firms’ Short-Run and Long-Run Decisions
• Perfect Competition

Imperfect Competition

• Basics of Imperfectly Competitive Markets
• Monopoly
• Price Discrimination
• Monopolistic Competition
• Oligopoly and Game Theory

Factor Markets

• Changes in Factor Demand and Factor Supply
• Profit-Maximizing Behavior in Perfectly Competitive Factor Markets
• Monopsonistic Markets

Market Failure and the Role of Government

• Socially Efficient and Inefficient Market Outcomes
• Externalities
• Public and Private Goods
• The Effects of Government Intervention in Different Market Structures
• Inequality