ADVANCED PLACEMENT MICROECONOMICS
Magnolia West High school-2014-2015
Jeremy Day-281-252-2550 (jday@magnoliaisd.org)
WELCOME TO AP Microeconomics!
Microeconomics is the study of how individuals, households, businesses, and government
make economic decisions in the context of different types of markets and economic
circumstances. AP Microeconomics will prepare students to take the corresponding
Advanced Placement Exam in May.
PURPOSES
The course goals are:
1. To give students an understanding of microeconomic concepts and
theories.
2. To enable students to use these concepts to analyze current economic
problems and issues.
3. To give students practical experience in communicating their
understanding of various economic issues through both written and oral
means.
4. To develop in students the “economic way of thinking”—the economist’s
systematic use of analytical decision-making skills to discuss and solve
problems.
TEXT
Principles of Microeconomics by N. Gregory Mankiw
EXPECTATIONS
Class preparation and participation are extremely important. The classroom is a place of
mutual respect with learning as our goal. Students are expected to model such respect
and encouragement. Incomplete or late assignments will be severely penalized. If a
student is absent on the day an assignment is due, that assignment is due upon the
student’s return to class. If a student is absent from class, it is his/her responsibility to
obtain all make-up work from the teacher and fellow students and to arrange any
necessary make-up assessments. The reading for this course is both exciting and
rigorous. It is the student’s responsibility to set aside time to thoroughly read each
section of the assigned material. Mastery of this material will prove invaluable during
class discussions, activities, lectures, and on the AP exam itself. All other policies stated
in the MWHS Student Handbook are in effect in the classroom setting.
For grading guidelines please see the schools website.
EXAMS AND QUIZZES
Quizzes and Exams will be given throughout the semester in order to assess
understanding of course material and to prepare students for the AP Microeconomics
Exam. These assessments will model the actual AP exam in terms of both time and
structure so that students become continually more comfortable with both aspects of AP
testing. I will give surprise quizzes randomly to make sure you are understanding the
material. I will average your quiz grades and that will count as one of your summative
grades.
AP EXAM
Students are strongly encouraged to take the AP exam in May. If they make a 3 or higher
on the test, most colleges will grant them a 3 hour credit for economics. This is a
tremendous opportunity for the student to gain credit while in high school at a minimal
cost.
Tutoring
I am available most days before school in my room or by appointment after school.
Students are encouraged to stop by for questions, review, and extra help. Closer to the
actual exam date, after-school review sessions will also be scheduled. My phone number
and email address can also be found at the top of the syllabus. Please feel free to contact
me with any questions or concerns throughout the semester.
Things Needed for Class
1 Box of Dry Erase Markers
1 Ream of 8x11 Computer Paper
1 3 ring Binder
1 Cracking the AP Economics Macro & Micro Exams, 2010 Edition
Bring your AP Packets everyday( I will give these to you)
Complete and return to Mr. DAY
I have read and understand the requirements, expectations, and grading procedures for
Advanced Placement Microeconomics.
Student Name
______________________________________ Date ____________
Student signature________________________________________Date____________
Parent Signature ________________________________________ Date ___________
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Unit 1
Scarcity, choice, and opportunity cost
Production possibilities curve
Comparative advantage, specialization, and trade(Hatfields and McCoys)
Economic systems(Traditional, Command, and Market)
Property rights and the role of incentives-Free Enterprise System
Marginal analysis-Equations for Margins-MC, MR, MU, and MP
Circular Flow Model
Accountants vs Economist
Implicit/Explicit Cost
Unit 2
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Demand-Reading the Graph
Quantity Demanded
Law of Demand
Inferior and Normal Goods
Change in Demand Curve
Supply-Reading the Graph
Quantity Supplied
Law Supply
Change in Supply Curve
The Date-Equilibrium
Price Floors and Ceilings
Shortages/Surpluses-Ticket Scalpers are good
Consumer Surplus
Producer Surplus
Elastic/Inelastic-Determinants
Perfectly Elastic/Inelastic
Midpoint Formula/Total Revenue Formula
Taxes
Deadweight Loss
Total Revenue from Tax
Import and Exports
Unit 3 Utility and Production
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Utility-Total and Margin
Equation-MU
Utility Maximization-How many Hamburgers to Buy
Law of Diminishing Marginal Utility
Reading the Graph-Relate to Demand Curve
Production of Cookies-How many workers is too many
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Total Production
Marginal Production
Equation for Marginal Production
Law of Diminishing Marginal Returns-Too many cooks in the Kitchen
Average Production-Equation and what does it mean?
AP and MP relationship
Unit 4 Cost Curves
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Fixed Cost-Definition and Reading the Curve
Variable Cost-Definition and Reading the Curve
Total Cost-Definition Relationship with VC and FC
Total cost versus Unit Cost
Average Costs-Definition
Average Fixed Cost-Definition and Reading the Graph
Average Variable Cost-LODMR Relation
Average Total Cost-Relationship with AFC and AVC
Short-run Atc curves
Long-run Atc-Economies of Scale, Diseconomies of Scale and Constant
Returns
Marginal Cost-Equation, LODMR, and relationship with AVC and ATC
Unit 5 Perfect Competition Firm
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Characteristics of Firm
Market Sets Price
Marginal Revenue-Equation
Average Revenue-Equation
Marginal Revenue=Marginal Cost
Marginal Revenue, Price, Average Revenue, and Price
Magic Q-How many to Produce
Profit Maximization Point=Magic Q
Calculating Profits and Losses
Normal Profits or Zero Economic Gain
Short-run FC-Sunk
AVC=Open/Closed
ATC=Open/Shutdown
Supply Curve-Mc>AVC Short-run
Supply Curve-Mc>ATC Long-run
MC/AVC/ATC/MR-Moving up or down
Long-run always at Zeg
Allocative Efficiency and Productivly Efficient
Unit 6 Monopolies
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Characteristics
How they Form
Government Laws Stopping them
Reason MR is always less then Price
Profit Maximization Point-Magic Q
Finding the Price
Calculating Profits and Losses
Deadweight Losses
Inefficiency of Monopolies-AE and PE
Price Discrimination
Perfect Price Discrimination
Natural Monopolies
Regulated Versus Unregulated Monopolies
Social Optimum
Unit 7 Monopolistic Competition and Oligopoly
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Characteristics of Monopolistic Competition
Reading the Graph
Finding Profit Maximization and Magic Q
Long-run Zero Economic Gain
Efficiency
Oligopolies
Characteristics
Collusion/Cartels
Game Theory
Follow the Leader Tendencies
Kinked Demand Curve Model
Efficiency
Unit 8 Labor/Resource Market/Wages
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Calculating Marginal Revenue Products
MRP=MRC
MRPL
Labor/Capital and MRP
Wage Market and Firm
Pure Competition Labor Market
Monosony Labor Market
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Unit 9 Market Failures
Understanding Society versus Firm
MSC and MPC
MSB and MPB
Positive and Negative Externalities
Taxes and Subsidies
Public goods versus private goods
Free Rider
antitrust policy
Regulation
Income distribution
Equity
Sources of income inequality