AP Microeconomics Course Skills Review

SK1 has four subskills labeled 1.A through 1.D. Subskill 1.A asks you to describe a concept or model in words. Subskill 1.B asks you to recognize a model from a written scenario. Subskill 1.C asks you to identify a model from numerical or quantitative data. Subskill 1.D asks you to compare models by explaining similarities, differences, or limitations. On the MCQ, SK1 questions often give you a definition or scenario and ask which concept it describes.

• 1.A Describe: State what a concept or model means in economic terms, such as explaining what marginal cost represents.
• 1.B Recognize from scenario: Read a written situation and identify which market structure or model it fits, such as identifying oligopoly from a description of interdependence.
• 1.C Identify from data: Use numbers, a table, or a calculation to name the relevant concept, such as computing price elasticity and identifying the result as elastic.
• 1.D Compare models: Explain how two models differ or share features, such as comparing perfect competition and monopolistic competition on long-run profit.

SK2 is the largest MCQ skill category at 37 to 47 percent of multiple-choice points. It asks you to explain how a given economic outcome occurs or what action would produce a target outcome. This is not identification. You must show the causal chain: what changes, which curve or variable responds, and what the result is. SK2 also includes reading quantitative results and interpreting what they mean in context.

• Causal chain: The step-by-step reasoning that connects a cause to an outcome, such as: subsidy lowers producer cost, supply increases, equilibrium price falls, quantity rises.
• Explain how: Walk through the mechanism that produces a stated outcome, not just name the outcome.
• Explain what action: Identify the policy or change that would achieve a given target, such as what a government should do to correct a negative externality.
• Interpret quantitative results: Read a number from a graph or table and state what it means economically, such as reading consumer surplus from a supply-and-demand diagram.

SK3 asks you to take a starting condition plus a change and work out the outcome using a model, a cross-market connection, or a calculation. This is the prediction skill. You are not explaining a given outcome; you are figuring out what the outcome will be. SK3 questions often involve shifts in supply or demand, changes in factor markets, effects of taxes or subsidies, or calculations like total revenue, profit, or elasticity.

• Model application: Use a supply-and-demand, cost curve, or factor market model to trace the effect of a stated change on price, quantity, or profit.
• Cross-market effect: Trace how a change in one market, such as the labor market, affects outcomes in a related product market.
• Calculation: Compute a specific value such as marginal revenue, price elasticity, or deadweight loss using given data.
• Direction of change: State whether a variable increases, decreases, or is indeterminate, and justify the direction using the model.

SK4 is primarily tested on the FRQ section and accounts for 30 to 50 percent of FRQ points. It has three components: creating an accurately labeled graph from scratch, showing a specific situation on an existing graph, and demonstrating how a change shifts the outcome. Every graph must have labeled axes, labeled curves, and a clearly marked equilibrium point. Partial credit is common, so a correctly labeled graph with a wrong shift still earns points for the labels.

• Accurately labeled graph: Axes must be labeled with the correct variable names, curves must be labeled by name, and equilibrium must be marked with a point and values.
• Show a specific situation: Place a curve or point at the correct position to represent a given condition, such as drawing a monopolist's profit-maximizing output where MR equals MC.
• Demonstrate a change: Shift the relevant curve in the correct direction and identify the new equilibrium, labeling it distinctly from the original.
• Partial credit structure: FRQ graphing parts award points for correct labels, correct initial graph, and correct shift separately, so each component is worth attempting.