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Instructions for Side by Side Printing
  1. Print the notecards
  2. Fold each page in half along the solid vertical line
  3. Cut out the notecards by cutting along each horizontal dotted line
  4. Optional: Glue, tape or staple the ends of each notecard together
  1. Verify Front of pages is selected for Viewing and print the front of the notecards
  2. Select Back of pages for Viewing and print the back of the notecards
    NOTE: Since the back of the pages are printed in reverse order (last page is printed first), keep the pages in the same order as they were after Step 1. Also, be sure to feed the pages in the same direction as you did in Step 1.
  3. Cut out the notecards by cutting along each horizontal and vertical dotted line
To print: Ctrl+PPrint as a list

35 notecards = 9 pages (4 cards per page)

Viewing:

AP Micro Graphs

front 1

Shift factors

  • Technology
  • Availability of resources

Other

  • Straight line: Constant opportunity cost
  • Bowed out: Increasing opportunity cost

back 1

PPC

front 2

  • binding must be below equilibrium
  • quantity demanded is greater than quantity supplied
  • creates a shortage
  • example rent control

back 2

Price cealing

front 3

  • binding must be above equilibrium
  • quantity supplied is greater than quantity demanded
  • create a surplus
  • example a minimum wage

back 3

Price floor

front 4

  • queens over princesses

back 4

elasticity along a demand curve

front 5

  • less elastic curve pays more tax
  • perfectly in elastic puts tax all on producers
  • perfectly elastic puts tax all on consumers

back 5

Supply and demand with Tax, CS, and PS

front 6

  • will keep producing until price falls below avc
  • area between avc and atc is the amount of fixed cost
  • change in fixed cost moves atc only
  • change in variable cost moves atc, avc, and mc

back 6

Cost curves

front 7

  • economies of scale, constant returns to scale, diseconomies of scale
  • monop comp in the long run is producing in economies of scale

back 7

LRATC

front 8

  • price taker
  • product is identical and has perfect substitutes
  • when profit is made in the short run firms enter (no barriers to entry)
  • zero economic profit in the long run
  • both productively efficient and socially optimal in the long run

back 8

Perfect competition

front 9

  • high barriers to entry
  • unique product
  • price maker
  • produces in the elastic region of the graph
  • not productively efficient or socially optimal

back 9

monopoly

front 10

  • d and mr are the same
  • there is no CS or DWL

back 10

price discriminating monopolist

front 11

  • when demand intersects atc while demand is downward sloping
  • government can regulate (at socially optimal quantity with a price cealing)
  • firm would need a lump sum subsidy (atc would be greater than price)

back 11

natural monopoly

front 12

  • atc touches but does not cross darp line

back 12

monopolistic competition in long run equilibrium

front 13

  • differentiated product
  • some control over price
  • when profit is being made firms will enter (no barriers to entry)
  • demand for the firms product increases when firms leave the market and decreases when firms enter
  • zero economic profit in the long run
  • LRATC tangent at Q1 in long run
  • not productively efficient or socially optimal

back 13

monopolistic competition in short run profit

front 14

  • firms are wage takers
  • sometimes just a shift in mrp
  • hire where mrp= mfc
  • min wage results in less workers hired

back 14

perfectly competitive labor market

front 15

  • wage maker
  • mfc curve is above the supply curve
  • mfc doesn’t equal wage
  • firm will hire additional labor as long as mrp is greater than mfc
  • hires fewer workers than a perfectly competitive labor market

back 15

monopsony

front 16

  • good is overproduced in the market
  • msc> mpc
  • cost to society is higher than the individual firm
  • needs a per unit tax on producer to be socially optimal

back 16

negative production

front 17

  • good is underproduced in the market
  • msb>mpb
  • benifit to society is higher than the benefit for the individual firm
  • needs a per unit subsidy on consumer to be socially optimal

back 17

positive consumption

front 18

4 dots

back 18

  • profit maximizing mc=mr
  • socially optimal mc=d
  • fair return atc=d
  • revenue maximizing point where mr crosses q axis

front 19

elasticity

back 19

queens/ princesses

front 20

price elasticity of demand ed>1

back 20

%change in quantity demanded/%change in price

front 21

cross price elasticity of demand

back 21

% change in demand/ % change in p of related good

front 22

substitutes

back 22

e cross price > 0 positive number

front 23

complements

back 23

e cross price < 0 negative number

front 24

income elasticity of demand

back 24

% change in demand/ % change in income

front 25

normal goods

back 25

e income > 0 ppl will spend more on these when their income rises

front 26

inferior goods

back 26

e income < 0 ppl will spend less on these when income rises

front 27

Total revenue

back 27

p x q

front 28

price elasticity of supply es>1

back 28

%change in quantity supplied/ %change in price

front 29

utility maximizing rule

back 29

MUx/Px = MUy/Py

front 30

Fixed costs

back 30

constant, exists at zero output

front 31

Variable costs

back 31

change as output changes

front 32

Total costs

back 32

Fixed costs+ variable costs

front 33

Marginal cost

back 33

Change in TC (change in TC/ change in Q)

front 34

MPP

back 34

change in total product/ change in quantity of labor

front 35

MRP

back 35

Output x MPP

hire where mrp is greater than or equal to mfc