Economic concepts in AP® Microeconomics
What is microeconomics
The difference between micro and macro economics
The existence of limited resources along with unlimited wants results in the need to make choices AP® Microeconomics, therefore, begins by introducing the concepts of opportunity costs and trade-offs, and illustrates these concepts by using the production possibilities curve and other analytical examples.
AP® Microeconomics then proceeds to consider how different types of economies determine which goods and services are produced, how to produce them, and to whom to distribute them to.
AP® Microeconomics seeks to understand why and how specialization and exchange can increase the total output of goods and services.
AP® Microeconomics makes a distinction between absolute and comparative advantage, and seeks to identify comparative advantage from differences in opportunity costs, and to apply the concept of comparative advantage, in order to determine the basis under which mutually advantageous trade can take place between countries.
Specific examples from actual economic situations are used to illustrate and reinforce the principles involved in AP® Microeconomics Economic Concepts section.
The importance of property rights, the role of incentives in the functioning of free markets, and the principle of marginal analysis are also highlighted here in the Economic Concepts section of the AP® Microeconomics course.