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AP Microeconomics aims to give students an understanding of the principles of economics that apply to the functions of individual decision makers, both consumers and producers, within the economic system. It places primary emphasis on the nature and functions of product markets and includes the study of factor markets and of the role of government in promoting greater efficiency and equity in the economy. According to surveys of comparable curricula at four-year colleges and universities, it is equivalent to a one-semester introductory college course.

Topics covered on the exam include:

Basic Economic Concepts (8–14%)

  • Scarcity, choice and opportunity cost
  • Production possibilities curve
  • Comparative advantage, absolute advantage, specialization and trade
  • Economic systems
  • Property rights and the role of incentives
  • Marginal analysis

The Nature and Functions of Product Markets (55–70%)

  • Supply and demand
  • Theory of consumer choice
  • Production and costs
  • Firm behavior and market structure

Factor Market (10–18%)

  • Derived factor demand
  • Marginal revenue product
  • Labor market and firms’ hiring of labor
  • Market distribution of income

Market Failure and the Role of Government (12–18%)

  • Externalities
  • Public goods
  • Public policy to promote competition
  • Income distribution

Read the full course description and exam information with sample questions.