AP Microeconomics Tips

The Ultimate List of AP Microeconomics Tips

If concepts like “national income” or “price-level determination” feel overwhelming, dull, or hard to digest, this ultimate list of AP Microeconomics tips is here to rescue you from the drudgery! Knowing what to focus on is often the hardest part of preparing for an AP exam, and AP Micro is no exception. You must have a full and deep understanding of important economic concepts, but you must also know how to take the exam and what to expect on exam day.

The AP Microeconomics exam places great emphasis on product markets, economic performance measures, the financial sector, economic growth, and international economics, as well as the analysis of charts, graphs, and data to explain these concepts. All AP exams are supposed to be challenging, AP Micro not excluded, so let’s take a look at the 2015 score distributions for the AP Microeconomics exam to get a better picture of the overall difficulty of the exam:

– 17.9% of test-takers earned the best possible score of 5

– 28.7% of students received a score of 4

– 19.9% of test-takers got a score of 3

– 14.4% of students received a score of 2

– 19.1% of students got a score of 1

(Fun fact: Only 49 AP Micro test-takers nationwide got a perfect score of 90/90 on the exam!)

As you can see, it is very possible to receive a passing score of 3 and above on the exam; over 66% of test-takers passed! This means that only around 33% did not pass. It’s interesting to note that 28.7% earned a score of 4, which is a very high percentage, especially when compared to other AP exams. This means that if you put time and effort into studying and preparing for the exam, and use some of the strategies outlined below, you should be all set to get your best possible score on the AP Micro exam!

AP Microeconomics General Exam Tips 

1. Know the format of the AP Microeconomics exam. You will have 2 hours and 10 minutes to answer 60 multiple-choice questions and 3 free-response questions. The 70-minute multiple-choice section is worth 66% of your total exam score, while the 60-minute free-response section is worth 33% of your total exam score.

2. Be aware of the common mistakes. Over the history of the AP Microeconomics exam, there have been some commonly missed questions, common misunderstandings, and overall common test-taker mistakes. Learn from the errors or lack of knowledge of others and be sure to focus on the following concepts:

– Difference between a change in demand versus a change in quantity demanded

– Understanding diminishing returns

– Finding the profit maximizing quantity (price)

– Finding the perfectly competitive firm’s supply curve

– How an increase or decrease in demand changes long-run equilibrium for firms and industries

– Price and marginal revenue for a monopoly

– Knowing how to correctly shade the area of economic profit and economic losses

– Monopoly vs. competition

– Understanding how to graph a natural monopoly and the socially-optimal output and fair-return output levels

– Single price monopoly vs. price discrimination

– Wage determination

– Tax incidence and efficiency loss

3. Make your own Microeconomics flashcards! Using flashcards to remember key concepts is a common and very effective study technique, especially for the AP Micro exam. The best way to use flashcards is to make your own. The simple act of hand-writing out terms and definitions in your own words is key to making the information stick. To find a list of the microeconomics terms and concepts you should know, check out Alternatively, you can find virtual flashcards that function like real flashcards at The Economics Classroom. There are over 115 virtual flashcards covering key microeconomics concepts, which you can shuffle through, click to view definitions, and follow links to learn how certain concepts connect. Try to go over your hand-written flashcards, or the virtual flashcards, for at least 15 minutes each day. Incorporating economics into each day leading up to the exam (starting as soon as possible!) is essential to learning and remembering key terms, without having to cram at the last minute.

4. Watch Microeconomics review videos. AP Microeconomics students and teachers cannot recommend Mr. Clifford’s ACDC Leadership AP Microeconomics videos enough! Mr. Clifford is a real-life AP teacher who injects humor and fun into his videos. He has 6 units of microeconomics videos covering basic concepts; supply, demand, and consumer choice; costs of production and perfect competition; imperfect competition; resource market; and market failures. If you’re ever feeling pulled into the dark abyss of textbooks and readings, take a break by watching these videos. Take notes to make sure you’re actively watching the videos, not just mindlessly trying to avoid homework. Videos are great for reinforcing concepts you’ve already learned, understanding ideas you struggled with before, or showing you a new way to look at a concept. When you’ve watched all of Mr. Clifford’s videos, try Khan Academy’s Microeconomics videos, which has dozens of videos on key microeconomics concepts.

5. Review all of the important graphs. A large part of the AP Micro exam involves interpreting economic graphs and diagrams. You will need to know several key graphs for both the multiple-choice section and the free-response section, which means you have to know how to analyze graphs, but also how to correctly draw, label, and manipulate them. Make sure you know the following graphs:

– Production Possibilities Curve

– Market Equilibrium

– Price Floor and Price Ceiling

– Tax with Perfectly Elastic/Inelastic Demand

– Demand Curve on Top of Total Revenue Curve

– Positive & Negative Externalities

– Typical Cost Curves

– Perfectly Competitive Market with Firm in Long-Run Equilibrium (side-by-side)

– Perfectly Competitive with Short-Run Profit (side-by-side)

– Perfectly Competitive with Short-Run Loss (side-by-side)

– Monopoly with Profit

– Monopoly Competition in Long-Run Equilibrium

– Labor Market and Typical Firm (side-by-side)

– Monopsony

Check out the Essential Graphs for AP Microeconomics to see great descriptions and explanations of the above graphs.

6. Buy an AP Microeconomics review book! Don’t wait to use a review book in the weeks leading up to the exam! It’s important to start preparing with review books at the very start of your AP course. These books are usually written by AP teachers and professionals with years of experience. They know which concepts to cover and focus on, which makes review books much more concise than many textbooks. Most of them include diagnostic tests, practice questions, practice exams, study strategies, and succinct explanations of the key terms you need to know, organized by topic. Use review books to supplement your textbook readings. Check out 5 Steps to a 5, Barron’sPrinceton Review, or REA’s Crash Course. Don’t underestimate the importance of review books!

7. Follow Microeconomics blogs and social media accounts. How much time do you spend using social media each day? Odds are, quite a lot! Use this to your advantage. Follow microeconomics-themed social media accounts. That way, when you’re scrolling through Facebook or Twitter, you’ll come across microeconomics material. It’s essential that you try and incorporate economics into your daily life, so what better way to do this than through social media? Whatever platform you prefer, you can find economic study material: search AP Microeconomics on Pinterest, “like” Economy Watch on Facebook, go through the #microeconomics tag on Twitter, and follow blogs like The Young Economist or Econ Point of View.

8. Use comprehensive online study guides. Thank goodness for the Internet! Over the years, AP Micro teachers and students have created and posted online comprehensive study guides, covering everything you need to know. Print one or two of these study guides out and highlight, underline, and annotate them to make them your own. Keep them in your binder for easy access. Try Jason Welker’s AP Microeconomics: Exam Study Guide. If you’re struggling with a particular unit, search for study guides covering just one particular topic/unit. You can find study sheets and power point presentations for almost anything. Take advantage of your online resources!

9. Review all of the essential AP Microeconomics formulas. To answer certain multiple-choice and free-response questions, you will need to know specific formulas, ranging from marginal cost, to supply elasticity, and from average variable cost, to marginal revenue product. You will need to not only memorize these formulas, but also know how to apply them to complex word problems. Check out this Formula Chart for AP Microeconomics to explore the formulas you’ll need to know for the exam.

10. Answer the AP Microeconomics question of the day. If you sign up to com (it’s free!) you can have an AP Micro question of the day sent to your email. Each daily question is formatted based on the AP test, and comes with explanations along with the ability to track your progress over time. If you want more than just one question per day, checkout Albert.io! There are dozens and dozens of microeconomics questions based on the AP Micro exam, complete with video explanations, answer percentages, and questions ranging from easy to difficult. It is crucial that you practice answering AP Micro questions on a daily basis – even if it’s just one each day!

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AP Microeconomics Multiple-Choice Tips

1. Familiarize yourself with the format of the AP Micro multiple-choice section.There are 60 total multiple-choice questions on the exam that you will have to answer in a 70-minute time period. Keep in mind that the multiple-choice section counts for 66% of your total overall exam score, so it is an essential part of the exam. You will be tested on your knowledge of economic concepts and graphs, your economic critical thinking skills, and your analysis abilities.

2. Know the concepts covered on the exam. On the College Board website, you will find a useful topic outline designed for the course, called the AP Microeconomics Course Description. There, you will find example multiple-choice problems and a detailed bulleted list of the key concepts you need to know. The table below is a general outline of the more detailed table you can find on the website. Keep in mind the percentages of each concept area:

Content Area

Specific Concepts Covered

Percentage of Multiple-Choice Section of Exam

Basic Economic Concepts – 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

8-14%
Supply and Demand – Market equilibrium Determinants of supply and demand Price and quantity controls Elasticity– Consumer surplus, producer surplus, and allocative efficiency

– Tax incidence and dead-weight loss

15-20%
Theory of Consumer Choice – Total utility and marginal utility

– Utility maximization: equalizing marginal utility per dollar

– Individual and market demand curves

– Income and substitution effects

5-10%
Production and Costs – Production functions: short and long run

– Marginal product and diminishing returns

– Short-run costs

– Long-run costs and economies of scale

– Cost minimizing input combination and productive efficiency

10-15%
Firm Behavior and Market Structure – Profit

– Perfect competition

– Monopoly

– Oligopoly

– Monopolistic competition

25-35%
Factor Markets – Derived factor demand

– Marginal revenue product

– Hiring decisions in the markets for labor and capital

– Market distribution of income

10-18%
Market Failure and the Role of Government – Externalities

– Public goods

– Public policy to promote competition

– Income distribution

12-18%

3. Budget your time effectively. The multiple-choice section is a very important part of the test, so it’s imperative that you answer each and every question. Because of this, you need to make sure you budget your time wisely. You don’t want to be left with only a few minutes to answer 10 questions. Since you have to answer 60 multiple-choice questions in 70 minutes, you have just over a minute to spend on each question. On the AP Micro exam, it’s safe to say that there will be around 10-20 “easier” questions. Make sure you can identify them and answer them quickly so that you have more time to answer the “harder” questions.

4. Pretend the question is a fill-in-the-blank. Cover up the answer choices as you’re reading the question. Before you look at the potential answers, come up with an answer as if the question were a fill-in-the-blank. This prevents bias when you see an answer choice that you absolutely know must be the right answer, even though you haven’t finished reading the entire question.

5. Keep in mind standard multiple-choice strategies. You’re probably aware of the more general multiple-choice test-taking strategies, such as educated guessing and the process of elimination, but it’s still useful to review them. Keep the following standard tips in mind when taking the multiple-choice section of the AP Microeconomics exam:

– Answer EVERY single question. No points will be deducted for wrong answers like in previous years. Therefore, you have absolutely nothing to lose and everything to gain by answering ALL of the questions.

– Beware of “EXCEPT” and “NOT” questions. These are usually designed to trip you up, especially since the multiple-choice section is fast-paced and many students tend to skim.

– Underline, circle, cross out, or draw graphs in the test booklet if it helps.

– If you’re stuck on a particular question, try reading other multiple-choice questions and answers. Seeing a certain economics vocab word could potentially trigger something in your memory and help you answer the question.

– Since you’re under time constraints, pick your favorite letter out of a, b, c, d, or e. If you have absolutely no idea what the answer is to a question, or if you’re running out of time quick, always pick that letter as your answer.

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AP Macroeconomics Free Response Portion Tips

1. Know the format of the free-response section. On the AP Micro FRQ section, you will have to answer three questions in a total of 60 minutes. The first 10-minutes of this time period is a mandatory reading/planning period. These questions will ask you to analyze scenarios using different course concepts, and could require you to include graphical analysis. You will have to answer one long essay that makes up 50% of your free-response score, and two shorter essays, which each count for 25% of your FRQ score. Keep in mind that the free-response section counts for 33% of your entire AP Microeconomics exam score.

2. Use the 10-minute reading period to plan your answer. The 10-minute reading period at the start of the FRQ section is mandatory. You should not begin writing your essay answers during this time, but you should still use this time wisely. Read and re-read the questions, think about possible solutions, and jot down a few notes. It’s not necessary to plan out every detail of your answer, but have a general idea of what you want to discuss before the 50-minute writing period begins. It’s important that you read all three questions during the planning period.

3. Budget your time. The long FRQ essay is worth 50% of your free-response section score, so you should spend 50% (25 minutes) of your time answering it. Divide your remaining time equally between the two shorter questions, so spend roughly 12 minutes answering these.

4. Emphasize how you came to your answer. You can’t just list the results of your analysis or make simple assertions. Don’t say things like “the price increased” and leave it there. You must explain why the price increased and how you arrived at your answer.

5. Don’t forget to label your graphs! Labeling is very important on the AP Microeconomics exam. Even if your graph or diagram is correct, you will lose points for not clearly, fully, and correctly labeling it. Label all axes, curves, and directional changes with black or dark blue ink. Keep in mind that even if you label everything, you could still lose points if the labels you’ve chosen are not clear to the AP grader.

6. Use the correct economic terminology. Your job on the AP Micro exam is to convince the graders that you know your stuff. In order to do this, you must use the correct economic terminology to explain your answers. For example, do not refer to the market demand curve for a product as the aggregate demand curve, since this is a macroeconomic concept that relates aggregate expenditures at different price levels. Keep these other terminology tips in mind:

– Write “increased” instead of “went up”

– Write “decreased” instead of “went down”

– Write that curves “shift” left or right, instead of “move” up or down

– Use “money” correctly:

— “Money” should only be used when discussing Money Creation and Money Supply.

— Do not write “money” when you mean “income.”

— Do not write “money” when you mean “currency.”

Incorrect Lingo

Correct Lingo

“People bought more things with their money.” “Consumer spending increased.”
“People made more money.” “Households earned increased income.”
“The federal reserve made more money.” “The Federal Reserve increased the money supply.”
“The government spent more money to help the economy.” “The federal government pursued expansionary fiscal policy by increasing government spending in response to a recession.”

7. Do not restate the question. You should get straight to the point with your answers as soon as possible. Don’t try to add unnecessary fluff by restating the question. Remember that AP graders look at the content of your answers, not the length. In fact, most of the best answers are very short and succinct.

8. Keep your answers organized by using outlines and letters. Organizing your answers is essential to making sure you receive full credit. To keep things in order and to stop you from accidentally leaving out something, label your answers using the same outline or letters as the question prompt. Most of the AP Micro FRQs will be multi-step and multi-part. If the question prompt uses (a), (b), and (c), you should use (a), (b), and (c) in your response. Similarly, the question prompt may use (i), (ii), and (iii). For example, on the 2015 AP Microeconomics exam, this question was included:

For questions like this, you would need to provide answers for each part. Even if you don’t know how to answer part (i), you should still attempt part (ii). Partial credit is better than no credit!

9. Graphs are your best friend. You should become very familiar with graphs since you will be required to draw and interpret them on the exam. If the question asks you to draw a graph, you should draw a graph, not just offer an explanation. Even if the question does not mention graphs, you may want to draw one anyway. In some cases, if you use the wrong economic lingo in your explanation but clearly show that you understand what is happening with your supplementary graph, you could still receive full or partial credit. That being said, you should not rely on graphs too heavily; they are not a magical solution to getting a high score.

10. Practice, practice, practice. Practice makes perfect. For the AP Micro exam, this is especially true. You cannot just read textbooks and study and expect to get a good score on the exam. Even if you have all of the knowledge in the world on microeconomics, the exam could throw you for a loop. That’s because you have to understand the format of the exam, how the AP readers will grade your responses, and how to take the exam in order to maximize your score. The only way to fully understand this is to take practice exams. The CollegeBoard website offers past AP Micro free-response essay questions, complete with sample student responses, grading rubrics, and score distributions from 2003 to 2015. Read the sample questions and student answers. Discover for yourself why certain responses got a high score and why some got low scores. Compare your responses with other students. How could you have improved? Did you oversimplify or over-complicate your answer? Check out Albert.io for more practice FRQs with sample answers.

Tips From AP Microeconomics Teachers

1. Read The Economics Anti-Textbook: A Critical Thinker’s Guide to Microeconomics. You can find a free copy of this book here. Thanks to Mr. K. from Eastview High School for the tip!

2. Remember: JTFJ. Just The Facts, Jack. Your AP Micro FRQ response should not be full or literary prose or historical narratives. Be economical with your words and only include the facts. Thanks to Mr. T. from Spartanburg High School for the tip!

3. Apply concepts from your textbook to the national news and personal decisions. Try keeping a journal of current events and how they relate to the AP Micro concepts you’re learning. Thanks to Mr. R. from Austin E. Lathrop High School for the tip!

4. The first FRQ question will require you to make connections between concepts and units. The two shorter questions will just cover one particular topic. Thanks to Ms. T. from Grapevine High School for the tip!

5. Assert your answers! Even if you aren’t sure your free-response analysis is correct, make sure you give a definite and confident answer. You could receive partial credit for asserting a correct conclusion, even if your analysis is wrong.

6. Make sure you know how to draw these graphs: production possibilities curve, supply and demand, perfect competition, monopoly and factor markets.Thanks to Mr. N. from Klein Oak High School for the tips!

7. Use abbreviations. Save valuable time on the FRQ section by using the commonly accepted abbreviations for economic terms and graphical curves. For example, you can use “MRP” instead of having to write out “Marginal Revenue Product.” Thanks to Mr. P. from Elkins High School for the tip!

8. Watch Welker’s Wikinomics videos. This is a very thorough video series. The website also includes very helpful microeconomics flashcards. MJM Foodie on YouTube is also a useful source of microeconomics videos. Thanks to Mr. M. from Gwendolyn Brooks College Preparatory Academy for the tip!

9. Read high-quality news sources as part of your weekly readings. In addition to your textbook, you should read The New York Times, The Washington Post, or The Wall Street Journal. It’s important to apply economic analysis to current events for the AP Microeconomics exam. Thanks to Ms. P. from Walter Payton College Prep for the tip!

Are you a teacher? Do you have an awesome tip? Let us know!

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Tips From Past AP Microeconomics Students

1. Use a combination of review books and online resources. I first read the AP Microeconomics 5 steps to a 5 review book and then moved on to the Princeton Review, which is more condensed but harder. In April, I started taking practice tests and reviewed with microeconomics courses in Coursera. I got a 5 on the AP Microeconomics exam.

2. Watch Khan Academy videos. These videos do a great job of explaining the fundamentals. They don’t necessarily follow the AP curriculum or go into too much depth, but they are a great way to learn or review the basics.

3. Know the lowest-cost equation (MUx/Px = MUy/Py). This equations shows up a lot on the practice tests I’ve taken, so it’s fair to say there’s a good chance of it showing up on the exam.

4. Triple check game theory charts when determining dominant strategies. It can be easy to misread them, and therefore give a wrong answer.

5. Review with AdvancedEcon videos. All of his videos are based on the test and offer a streamlined review of important concepts.

6. Think economically. Just memorizing graphs and diagrams is not enough to get a good score on the exam. You have to know how to observe and hypothesize economically. Remember that economics is about problem solving, not memorizing.

7. Know the graphs and curves. I had to invest a lot of time in not just memorizing, but understanding, all of the graphs and curves unique to Microeconomics (for example, why inelastic supply curves usually means higher “demand” for a product.”) I think having a really good understanding of the graphs and curves is the key to getting a 5 on the exam.

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