AP Microeconomics Unit 2 practice questions
Try 10 multiple-choice questions from Unit 2 here. Pick an answer to see why it's right or wrong, then take the timed test above for a full AP-style set.
Question 1
A shortage of semiconductor chips increases production costs for video game consoles. If the demand for consoles is relatively price elastic, how will the equilibrium price and quantity change compared to a situation where demand is price inelastic?
Price will rise less and quantity will fall more
Price will rise more and quantity will fall less
Price will rise less and quantity will fall less
Price will rise more and quantity will fall more
Price will remain constant and quantity will fall more
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Answer: (A)
Consumers with elastic demand are highly sensitive to price increases, leading to a large drop in quantity demanded that prevents producers from raising prices significantly.
Question 2
In a perfectly competitive market for wool, the linear demand curve intersects the vertical axis at $40. At the market equilibrium, the price is $24 and the quantity sold is 500 units. What is the value of consumer surplus in this market?
$4,000
$8,000
$12,000
$16,000
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Answer: (A)
Calculating the area of the consumer surplus triangle requires the formula 0.5 × base × height. With a base of 500 units and a height of $16 ($40 intercept - $24 price), the area is 0.5 × 500 × 16 = 4,000.
Question 3
A linear supply curve for handmade chairs intersects the vertical axis at $20. The market equilibrium price is $80, and the equilibrium quantity is 100 units. What is the value of producer surplus in this market?
$3,000
$4,000
$6,000
$8,000
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Answer: (A)
Calculating producer surplus requires finding the area of the triangle above the supply curve and below the equilibrium price. The height is $60 ($80 price - $20 intercept) and the base is 100 units, so 0.5 × 60 × 100 = 3,000.
Question 4
In the market for coffee, the equilibrium price is $4 and quantity is 1,000 units. A supply shock raises the equilibrium price to $6 and lowers the quantity to 800 units. Assuming a linear demand curve, by how much does consumer surplus decrease?
It decreases by $1,600
It decreases by $1,800
It decreases by $2,000
It decreases by $3,600
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Answer: (B)
Calculating the change in surplus involves finding the area of the trapezoid between the two prices to the left of the demand curve. Using the formula 0.5 × (Q1 + Q2) × ΔP, the calculation is 0.5 × (1,000 + 800) × 2 = 1,800.
Question 5
The market for wheat has a linear demand curve given by P = 100 - Q and a linear supply curve given by P = Q. If a government quota limits the quantity traded to 40 units, what is the value of the resulting deadweight loss?
A deadweight loss of $50
A deadweight loss of $100
A deadweight loss of $200
A deadweight loss of $400
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Answer: (B)
Calculating deadweight loss requires finding the area of the triangle between the quota (40) and equilibrium (50). At Q=40, demand price is $60 and supply price is $40 (height=20); the quantity gap is 10. Area = 0.5 × 10 × 20 = 100.
Question 6
In a perfectly competitive market for headphones, the demand curve is linear. The maximum price any consumer is willing to pay is $100, and the market equilibrium price is $60. If the equilibrium quantity is 500 units, what is the value of the consumer surplus?
$10,000
$20,000
$30,000
$40,000
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Answer: (A)
Calculating the area of the triangle below the demand curve and above the price yields 0.5 × 500 × ($100 - $60) = $10,000.
Question 7
A digital artist sells commissions in a competitive market where the supply curve is linear and passes through the origin. If the equilibrium price is $80 per commission and the equilibrium quantity is 100 commissions, what is the producer surplus?
$4,000
$2,000
$8,000
$16,000
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Answer: (A)
Calculating the area of the triangle above the supply curve and below the price yields 0.5 × 100 × ($80 - $0) = $4,000.
Question 8
Four consumers have the following maximum willingness to pay for a concert ticket: Consumer W ($50), Consumer X ($40), Consumer Y ($30), and Consumer Z ($20). If the market price is $35, what is the total consumer surplus?
$20
$70
$90
$140
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Answer: (A)
Summing the individual surpluses for buyers W ($15) and X ($5) yields $20; Y and Z do not purchase.
Question 9
In a market for solar panels, the equilibrium price is $400 and the equilibrium quantity is 1,000 units. The demand intercept is $900 and the supply intercept is $100. What is the total economic surplus in this market?
$400,000
$150,000
$250,000
$800,000
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Answer: (A)
Summing consumer surplus ($250,000) and producer surplus ($150,000) yields the total economic surplus.
Question 10
Price elasticity of demand and income elasticity of demand both measure consumer responsiveness, but they differ in the variable causing the change. Which of the following correctly describes a difference between them and a limitation of using income elasticity for market analysis?
Price elasticity reflects movement along the demand curve while income elasticity reflects a shift of the curve; income elasticity assumes the good's price remains constant.
Price elasticity reflects movement along the demand curve while income elasticity reflects a shift of the curve; price elasticity assumes consumer income remains constant.
Price elasticity reflects movement along the demand curve while income elasticity reflects a shift of the curve; income elasticity cannot account for substitution effects between goods.
Price elasticity reflects movement along the demand curve while income elasticity reflects a shift of the curve; income elasticity only applies to normal goods and cannot predict behavior for inferior goods.
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Answer: (A)
Connecting the graphical interpretation of elasticity with ceteris paribus assumptions.
What's on the AP Microeconomics Unit 2 practice test
The standard version takes about 63 minutes and follows the timing and directions of the AP exam, sized to one unit:
- 20 Multiple Choice Questions (23 minutes)
- 1 FRQ – FRQ 1 – Long (20 minutes)
- 1 FRQ – FRQ 2 – Short (20 minutes)
Questions are drawn from 2139 multiple-choice questions and 57 FRQs written for Unit 2, Supply and Demand.
Practice AP Microeconomics Unit 2 FRQs
Answer the unit's free-response questions one at a time and get a score on every part.
- FRQ 1 – Long (17 questions)
- FRQ 2 – Short (20 questions)
- FRQ 3 – Short (20 questions)
Review Unit 2 before you start
- 2.1 Demand
- 2.2 Supply
- 2.3 Price Elasticity of Demand
- 2.4 Price Elasticity of Supply
- 2.5 Other Elasticities
- 2.6 Market Equilibrium and Consumer and Producer Surplus
- 2.7 Market Disequilibrium and Changes in Equilibrium
- 2.8 The Effects of Government Intervention in Markets
- 2.9 International Trade and Public Policy