How individual firms, households, and markets allocate scarce resources.
Study guide last reviewed September 25, 2026 · see what changed
Format reflects the current published structure — always confirm against AP Central before test day, since formats occasionally change.
| Section | Details | Time | Weight |
|---|---|---|---|
| Section I – Multiple Choice | 60 questions | 1 hr 10 min | 66.7% |
| Section II – Free Response | 1 long + 2 short FRQs, often requiring graphs | 1 hr | 33.3% |
Straight answers about the AP Microeconomics exam — format, credit, dates, and this site.
Section I – Multiple Choice: 60 questions (1 hr 10 min, 66.7% of the total score); Section II – Free Response: 1 long + 2 short FRQs, often requiring graphs (1 hr, 33.3% of the total score). See the Exam Format tab above for the full breakdown, and always double-check the current year's format on AP Central before test day.
It's multiple-choice questions and written free-response or essay questions.
It depends entirely on the college — most award credit for a 3 or higher, but many selective schools require a 4 or a 5, and some don't grant credit at all for certain scores. Always check your target college's own AP credit policy page rather than assuming a 3 will count everywhere.
AP exams are administered during the College Board's annual testing window in the first two full weeks of May, with the exact date and time for each subject set by the College Board and announced the preceding fall. Check AP Central or your school's AP coordinator for this year's exact date.
Yes. The unit-by-unit study guide, worked examples, practice quiz, and full-length timed practice exam on this page are all free, with no login, signup, or paywall.
Unit-by-unit breakdown of what the course actually covers, in teaching order.
The same scarcity, opportunity cost, and comparative advantage foundations as macro, applied here to individual consumer and firm decision-making rather than the whole economy, plus marginal analysis (comparing marginal benefit to marginal cost) as the core microeconomic decision rule.
The law of demand and law of supply, determinants that shift each curve (versus movements along a curve caused by price changes), market equilibrium, and price elasticity of demand/supply (what makes a good elastic vs. inelastic, and how elasticity affects tax incidence and revenue).
Short-run cost curves (marginal cost, average total/variable/fixed cost) and their characteristic shapes from the law of diminishing marginal returns, and the perfectly competitive firm's profit-maximizing rule (produce where P = MC) in both the short run and long run (where entry/exit drives economic profit to zero).
Monopoly's profit-maximizing rule (MR = MC, then price from the demand curve) and the deadweight loss it creates, monopolistic competition's product differentiation and zero long-run economic profit, and oligopoly's interdependent decision-making, often analyzed through game theory (the prisoner's dilemma applied to pricing/output decisions).
How the same marginal analysis applies to input markets: firms hire labor up to the point where marginal revenue product equals wage, and factor market outcomes (wages, rent, interest, profit) are explained through the same supply-and-demand framework as product markets.
Externalities (negative, like pollution, and positive, like education) causing markets to over- or under-produce relative to the social optimum, public goods' non-excludable/non-rival nature causing free-rider problems, and government interventions (taxes, subsidies, regulation) intended to correct these failures.
Concrete, fully worked examples — this is what separates a page reviewers see as genuinely useful from one that just lists topics.
Price elasticity: price rises from $10 to $12 and quantity demanded falls from 100 to 80. Find elasticity using the midpoint method.
%ΔQ = (80−100)/90 ≈ −22.2%. %ΔP = (12−10)/11 ≈ 18.2%. Ed = −22.2/18.2 ≈ −1.22 — since |Ed| > 1, demand is elastic over this price range.
Short-run profit: a perfectly competitive firm faces P=$20, and at Q=50, MC=$20 and ATC=$15.
The profit-maximizing rule P=MC is satisfied at Q=50. Profit per unit = P − ATC = $5, so total economic profit = 50 × $5 = $250. Since this profit is positive, new firms will enter in the long run, shifting market supply right until price falls to the minimum of ATC and economic profit returns to zero.
Monopoly pricing: why does a monopolist charge a price above marginal cost, unlike a perfectly competitive firm?
The monopolist finds quantity where MR = MC, then reads price off the demand curve at that quantity — not off the MC curve. Because the demand curve sits above MR at that quantity, price ends up above marginal cost, creating the markup that's the direct source of monopoly deadweight loss.
Hiring decision: a firm sells output at $10/unit; the 10th worker's marginal product is 4 units, and the wage is $40.
MRP of the 10th worker = MP × P = 4 × $10 = $40, exactly equal to the wage — this is the last worker worth hiring. The firm hires up to the point where MRP = wage, the same profit-maximizing logic as P=MC applied to an input market instead of an output market.
Negative externality: a factory's pollution isn't reflected in its private production costs. How does the unregulated market outcome compare to the social optimum?
The private marginal cost curve sits below the social marginal cost curve (which includes the external cost), so the unregulated market produces more than the socially optimal quantity at too low a price. A Pigouvian tax equal to the external cost raises private MC up to social MC, correcting the overproduction — the standard policy response this scenario is built to test.
The errors that cost the most points across the whole exam, not just one unit.
Unofficial practice questions written for this study guide — not official AP content and not from College Board. Use them to self-check, then use the real past free-response questions below for authentic exam practice.
Unofficial practice, timed to feel like the real thing. Section I pulls from this page's full multiple-choice bank; Section II gives you free-response prompts to write out and self-score against a rubric. Bank size is still growing toward full exam length — timing is paced per-question, not pulled from this subject's official duration.