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MICROECONOMICS AP
Mr. Woodworth
The purpose of the AP course in microeconomics is to give students a thorough
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. The underlying purpose of the course if to prepare the
students to be successful on the AP Microeconomics test in May. The course is divided into four
units:
I.
BASIC ECONOMIC CONCEPTS
Basic Economic Concepts require students to understand the existence of limited resources along with
unlimited wants necessitates some form of allocation system.
II.
THE NATURE AND FUNCTIONS OF PRODUCT MARKETS
The Nature and Functions of Product Markets studies supply and demand models, consumer choice,
production and costs and the theory of the firm. Determinants of supply and demand are analyzed
as well as how changes in factors affect equilibrium price and output while emphasizing the
difference in shifts versus movements along the curves. The impact of various government policies
is studied as they affect equilibrium status and market efficiency. The theory of consumer and
producer surplus is introduced as well as the various concepts of elasticity. Consumer choice is
studied as well as how market and firm demand curves are derived concentrating on the law of
demand and the income and substitution effects. Production and cost analysis are studied in the
short and long run. The study of cost analysis focuses on average and marginal cost concepts as
applied to equilibrium and efficiency. The theory of the firm studies the different market structures
and how they differ. Focus is placed on the difference between demand and marginal revenue
curves for the various market structures and how the structures affect price and output decisions.
Allocative and productive efficiency is studied for each market structure as well as for the basis of,
and difference in, decision making for perfect or pure competition, monopoly, oligopoly and
monopolistic competition.
III.
FACTOR MARKETS
The study of Factor Markets involves the application of supply and demand concepts to markets for
land, labor and capital. Derived demand is analyzed as well as how the factor’s marginal product
and marginal revenue product affect the demand for and price of factors.
IV.
MARKET FAILURE AND THE ROLE OF GOVERNMENT
Market Failure and the Role of Government concentrate on the arguments for and against
government intervention in the marketplace. Marginal social benefit and marginal social cost
concepts are analyzed as they apply to externalities, public goods and market distribution of income
to determine the need for government intervention.
TEXT and RESOURCES
McConnell and Brue. Economics. 17th edition. New York: McGraw-Hill, 2008.
Morton, John S. Advanced Placement ECONOMICS. New York: National Council on Economic Education,
2003.
AP Central Website – Free Response Questions and other relevant information
Released AP Microeconomic Tests
REQUIREMENTS: Daily attendance is essential. The course teaches many new concepts and vocabulary
that are not easily transferable from other courses; therefore it is essential to be in class every day to
stay current on new material. If you are absent, see the teacher for missed assignments and to
schedule time for extra help if needed. There will be regular homework reading assignments and work
to be completed outside of class.
EVALUATION: Each marking period, the student’s grade will be determined by the following formula:
the number of points earned divided by the total number of points available. Out of the number of
points available:
Summative: (90%) - Each unit will conclude with a test. Other forms of assessments are
probable.
Formative: (10%) – homework assignments and other assessments.
.