AP Microeconomics

AP Economics Program

The AP Program offers two courses in economics: AP Macroeconomics and AP Microeconomics. Each course corresponds to one semester of a typical introductory college course in economics. AP Macroeconomics focuses on the principles that apply to an economic system as a whole. AP Microeconomics focuses on the principles of economics that apply to the functions of individual decision-makers, both consumers and producers, within the economic system.

AP Macroeconomics Course Content

The AP Microeconomics course provides students with an understanding of the principles of economics as they apply to individual decision-making units, including individual households and firms. The course examines the theory of consumer behavior, the theory of the firm, and the behavior of profit-maximizing firms under various market structures. Students evaluate the efficiency of the outcomes with respect to price, output, consumer surplus, and producer surplus. They examine the behaviors of households and businesses in factor markets, and learn how the determination of factor prices, wages, interest, and rent influence the distribution of income in a market economy. There are ample opportunities to consider instances in which private markets may fail to allocate resources efficiently and examine various public policy alternatives aimed at improving the efficiency of private markets.

Topic Outline for AP Microeconomics

I. Basic Economic Concepts

II. The Nature and Functions of Product Markets

a. Supply and demand

b. Theory of consumer choice

c. Production and costs

d. Firm behavior and market structure

III. Factor Markets

a. Derived Factor Demand

b. Marginal revenue product

c. Hiring decisions in the markets for labor and capital

d. Market distribution of income

IV. Market Failure and the Role of Government

a. Externalities

b. Public goods

c. Public policy to promote competition

d. Income distribution