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AP® Microeconomics Self-Paced

Syllabus

Course Essential Questions:

  • How do markets allocate goods and services in a world of scarcity?
  • How does marginal analysis help to explain human behavior?
  • How do profit-seeking firms make production decision in the face of cost and market competition pressures?
  • Why do markets sometimes fail to produce socially optimal outcomes, and what are some solutions to these problems?

Course Objectives:

  • Define and interpret economic principles and models.
  • Explain given economic outcomes.
  • Determine outcomes of specific economic situations.
  • Model economic situations using graphs or visual representations.

Unit 1: Basic Economic Concepts (Topics 1-3)

Topic 1: Introduction to AP Microeconomics

  • Understand the rules and policies of the course, and expectations of you
  • Develop your skills for navigating the course environment and using the various course tools
  • Understand that individuals and societies are forced to make choices because most resources are scarce.
  • Define scarcity and economic resources.

Topic 2: Modeling Opportunity Costs, Specialization, and Trade

  • Define the PPC and related terms.
  • Explain how the PPC illustrates opportunity costs, tradeoffs, inefficiency, efficiency, and economic growth or contraction under various conditions.
  • Calculate opportunity cost.
  • Define absolute and comparative advantage.
  • Determine absolute and comparative advantage.
  • Explain how specialization according to comparative advantage with appropriate terms of trade can lead to gains from trade.
  • Calculate mutually beneficial terms of trade.

Topic 3: The Foundational Model - Supply and Demand

  • Define the law of demand and the law of supply.
  • Explain the relationship between the price of a good or service and the quantity demanded (supplied).
  • Explain the determinants of demand and the determinants of supply.
  • Define market equilibrium.
  • Define a surplus and shortage.
  • Explain how prices adjust to restore equilibrium in markets that are experiencing imbalances.
  • Calculate the surplus or shortage in the market experiencing imbalance.
  • Explain how changes in demand and supply affect equilibrium price and quantity.

Unit 2: Supply and Demand (Topics 4-7)

Topic 4: International Trade and Public Policy

  • Define tariffs and quotas.
  • Explain (using graphs as appropriate) how markets are affected by public policy related to international trade.
  • Calculate (using data from a graph or table as appropriate) changes in market outcomes resulting from public policy related to international trade.

Topic 5: Elasticity

  • Complete reflective activity to analyze performance on practice AP Macro Exam.
  • Define measures of elasticity.
  • Explain (using graphs as appropriate) measures of elasticity and the impact of a given price change on total revenue and total expenditure.
  • Calculate (using graphs as appropriate) measures of elasticity.

Topic 6: Total Welfare and Tax Incidence

  • Define (using graphs as appropriate) market equilibrium, consumer surplus, and producer surplus.
  • Explain (using graphs as appropriate) how equilibrium price, quantity, consumer surplus, and producer surplus for a good or service are determined.
  • Calculate (using data from a graph or table as appropriate) areas of consumer surplus and producer surplus at equilibrium.
  • Define forms of government price and quantity intervention.
  • Explain (using graphs as appropriate) how government policies alter consumer and producer behaviors that influence incentives and therefore affect outcomes.
  • Calculate (using data from a graph or table where appropriate) changes in market outcomes resulting from government policies.

Topic 7: Consumer Choice Theory

  • Define the key assumptions of consumer choice theory.
  • Explain (using a table or graph as appropriate) how a rational consumer's decision making involves the use of marginal benefits and marginal costs.
  • Calculate (using a table or a graph when appropriate) how a rational consumer's decision making involves the use of marginal benefits and marginal costs.
  • Define marginal analysis and related terms.
  • Explain a decision using marginal analysis (using a table or graph when appropriate).

Unit 3: Production, Cost, and the Perfect Competition Model (Topics 8-10)

Topic 8: Profit and Profit Maximization

  • Define the different types of profit.
  • Explain how firms respond to profit opportunities.
  • Calculate a firm's profit or loss.
  • Define (using graphs or data as appropriate) the profit-maximizing rule.
  • Explain (using graphs or data as appropriate) the profit-maximizing level of production.

Topic 9: The Production Function and Firm Costs

  • Define (using graphs as appropriate) key terms and concepts relating to production and cost.
  • Explain (using graphs as appropriate) how production and cost are related in the short run and long run.
  • Calculate (using data from a graph or table as appropriate) the various measures of productivity and short-run and long-run costs.

Topic 10: The Perfectly Competitive Market and Firm

  • Explain (using graphs or data where appropriate) firms' short-run decisions to produce positive output levels, or long-run decisions to enter or exit a market in response to profit-making opportunities.
  • Define (using graphs as appropriate) the characteristics of perfectly competitive markets and efficiency.
  • Explain (using graphs as appropriate) equilibrium and firm decision making in perfectly competitive markets and how prices in perfectly competitive markets lead to efficient outcomes.
  • Calculate (using data from a graph or table as appropriate) economic profit (loss) in perfectly competitive markets.
  • Define social efficiency.
  • Explain (using graphs where appropriate) why resource allocation in perfectly competitive markets is socially efficient.

Unit 4: Imperfect Competition (Topics 11-13)

Topic 11: Monopoly

  • Define (using graphs as appropriate) the characteristics of imperfectly competitive markets and inefficiency.
  • Explain (using graphs as appropriate) equilibrium, firm decision making, consumer surplus, producer surplus, profit (loss), and deadweight loss in imperfectly competitive markets and why prices in imperfectly competitive markets cannot be relied on to coordinate the actions of all possible market participants and can lead to inefficient outcomes.
  • Calculate (using data from a graph or table as appropriate) areas of consumer surplus, producer surplus, profit (loss), and deadweight loss in imperfectly competitive markets.
  • Explain equilibrium allocations in imperfect markets relative to efficient allocations (using graphs where appropriate) and why these markets are inefficient.
  • Calculate (using graphs where appropriate) the deadweight loss resulting from the production of a non-efficient quantity.

Topic 12: Monopolistic Competition

  • Explain (using graphs as appropriate) equilibrium, firm decision making, consumer surplus, producer surplus, profit (loss), and deadweight loss in imperfectly competitve markets and why prices in imperfectly competitive markets cannot be relied on to coordinate the actions of all possible market participants and can lead to inefficient outcomes.
  • Calculate (using data from a graph or table as appropriate) areas of consumer surplus, producer surplus, profit (loss), and deadweight loss in imperfectly competitive markets.
  • Explain equilibrium allocations in imperfect markets relative to efficient allocations (using graphs where appropriate) and why these markets are inefficient.
  • Calculate (using graphs where appropriate) the deadweight loss resulting from the production of a non-efficient quantity.

Topic 13: Oligopoly

  • Define (using tables as appropriate) key terms, strategies, and concepts relating to oligopolies and simple games.
  • Explain (using tables as appropriate) strategies and equilibria in simple games adn the connections to theoretical behaviors in various oligopoly market and non-market settings.
  • Calculate (using tables as appropriate) the incentive sufficient to alter a player's dominant strategy).

Unit 5: Factor Markets (Topics 14-15)

Topic 14: Competitive Labor Markets and Monopsony

  • Define (using graphs as appropriate) key terms and concepts relating to factor markets.
  • Explain (using graphs as appropriate) the relationship between factors of production, firms, and factor prices.
  • Calculate (using data from a graph or table where appropriate) the marginal revenue product and marginal resource cost.
  • Explain (using graphs where appropriate) firms' and factors' responses to changes in incentives and constraints.
  • Define (using graphs as appropriate) the characteristics of perfectly competitive and monopsonistic factor markets.
  • Explain (using graphs where appropriate) the profit-maximizing behavior of firms buying labor (with other inputs fixed) in perfectly competitive and monopsonistic markets.
  • Calculate (using data from a graph or table where appropriate) measures representing the profit-maximizing behavior of firms buying labor (with other inputs fixed) in perfectly competitive and monopsonistic markets.

Topic 15: Other Factor Markets and Input Combos

  • Define (using graphs as appropriate) key terms and concepts relating to factor markets.
  • Explain (using graphs as appropriate) the relationship between factors of production, firms, and factor prices.
  • Define the cost-minimizing rule for hiring inputs.
  • Calculate the optimal input (profit-maximizing) input mix.

Unit 6: Market Failure and the Role of Government (Topics 16-17)

Topic 16: Externalities and Socially Optimal Outcomes

  • Explain (using graphs where appropriate) how private incentives can lead to actions by rational agents that are socially undesirable (inefficient) market outcomes.
  • Define externalities.
  • Explain (using graphs where appropriate) how in the presence of externalities, private markets do not take into consideration social costs or social benefits.
  • Explain (using graphs where appropriate) how public policies address positive or negative externalities.

Topic 17: Public Goods and Income Distribution

  • Define whether goods are rival and/or excludable.
  • Explain how the nature of rival and/or excludable goods influences the behavior of individuals and groups.
  • Define measures of economic inequality in income and wealth.
  • Explain sources of income and wealth inequality

Unit 7: Exam Preparation (Topics 18-20)

Topic 18: Practice AP Exam

  • Identify any gaps in knowledge that need to be reviewed before the AP Exam.
  • Gain familiarity with the types of questions that will appear on the AP Exam.
  • Function within the time constraints imposed by the AP Exam.

Topic 19: Practice AP Exam Analysis

  • Identify any gaps in knowledge that need to be reviewed before the AP Exam.
  • Gain familiarity with the types of questions that will appear on the AP Exam.
  • Function within the time constraints imposed by the AP Exam.

Topic 20: Reflections and Final Thoughts

  • Complete the course exit surveys, assessing the nature and difficulty of the course.
  • Review the expectations of the AP Microeconomics and assess your preparation for the exam.