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AP Microeconomics – Part 2: Imperfect Competition, Factor Markets & Market Failure( 30 Lectures)

AP Microeconomics – Part 2: Imperfect Competition, Factor Markets & Market Failure

Provider: GyanAcademy

📋 Quick Overview

  • Focus: Monopoly, Oligopoly, Game Theory, Labor Markets, Externalities, and AP Exam Prep.

  • Covers: Units 4, 5, and 6 of AP Microeconomics.

  • Target: Grades 11-12 | Prerequisite: Completion of Part 1.

  • Format: 30 Self-Paced HD Lectures (50 min each).

🎥 Module Breakdown

  • Module 1 (Imperfect Competition):

    • Monopoly: Revenue curves, profit max, deadweight loss, price discrimination.

    • Monopolistic Competition: Short-run vs. long-run equilibrium, excess capacity.

    • Oligopoly: Interdependence, collusion, cartels.

    • Game Theory: Payoff matrices, dominant strategy, Nash Equilibrium, Prisoner’s Dilemma.

  • Module 2 (Factor Markets):

    • Derived demand, Marginal Revenue Product (MRP), Marginal Resource Cost (MRC).

    • Profit-maximizing hiring rule: MRP = MRC.

    • Perfectly competitive labor markets (wage takers).

    • Monopsony (single buyer of labor) and its impact on wages and employment.

  • Module 3 (Market Failure & Government Role):

    • Externalities: Negative (pollution) and positive (education) – graphing and deadweight loss.

    • Government solutions: Pigouvian taxes, subsidies, tradable permits.

    • Public goods, private goods, and the free rider problem.

    • Common resources and the Tragedy of the Commons.

    • Income inequality: Lorenz Curve and Gini Coefficient.

  • Module 4 (Comprehensive Exam Prep):

    • Advanced FRQ strategies for complex graphs and game theory.

    • Full AP Mock Test: 60 MCQ + 3 FRQ (timed, simulated exam conditions).

    • Final review, answer walkthrough, and exam day strategies.

📦 What’s Included

  • 30 HD Video Lectures

  • 150+ Practice Questions & 4 Module Quizzes

  • 1 Full-Length AP Mock Test

  • Graphing Workbook (Imperfect Competition & Externality Graphs)

  • PDF Notes & Vocabulary Lists

  • Priority Doubt Support (24 hrs)

  • Certificate of Completion

📝 Key Outcomes

By the end, students will:

  • ✅ Master monopoly, monopolistic competition, and oligopoly graphs.

  • ✅ Apply game theory (Nash Equilibrium) to business decisions.

  • ✅ Analyze labor markets using MRP, MRC, and monopsony models.

  • ✅ Evaluate externalities and government intervention policies.

  • ✅ Be fully prepared for the AP Microeconomics exam.

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AP Microeconomics – Part 2: Imperfect Competition, Factor Markets & Market Failure

Complete Course Material | 30 Lectures (50 Minutes Each) | GyanAcademy

📋 Course Overview

Part 2 of the AP Microeconomics course focuses on market structures beyond perfect competition, the behavior of factor markets, and instances where markets fail to allocate resources efficiently. This section covers Unit 4 (Imperfect Competition), Unit 5 (Factor Markets), and Unit 6 (Market Failure & Government Role). It concludes with comprehensive exam preparation. Students will analyze monopoly power, game theory, labor demand, externalities, and public policy.
Duration: 30 Lectures (50 Minutes Each)
Prerequisites: Completion of AP Microeconomics Part 1 (Foundations, Markets & Production)
Outcome: Mastery of imperfect market structures, labor market dynamics, market failure analysis, and full readiness for the AP Exam.

📚 Detailed Lecture Breakdown

MODULE 1: Imperfect Competition (Lectures 1-10)

Lecture 1: Introduction to Imperfect Competition

  • Spectrum of market structures
  • Characteristics distinguishing imperfect from perfect competition
  • Market power and price setting ability
  • Overview of Monopoly, Monopolistic Competition, and Oligopoly
  • Takeaway: Understanding the continuum of market competitiveness.

Lecture 2: Monopoly: Characteristics & Barriers to Entry

  • Single seller, unique product, high barriers
  • Sources of barriers: Legal, Natural, Control of Resources
  • Comparison with Perfect Competition demand curves
  • Takeaway: Analyzing why monopolies exist and how they differ from competitive firms.

Lecture 3: Monopoly: Revenue & Profit Maximization

  • Downward sloping demand curve
  • Relationship between Price, Average Revenue, and Marginal Revenue
  • Profit maximization using MR = MC
  • Takeaway: Mastering the revenue structure and output decision for monopolies.

Lecture 4: Monopoly: Efficiency & Deadweight Loss

  • Allocative and Productive Inefficiency
  • Calculating Deadweight Loss
  • Comparison of surplus with Perfect Competition
  • Takeaway: Evaluating the welfare costs of monopoly power.

Lecture 5: Monopoly: Price Discrimination

  • Conditions for price discrimination
  • Perfect Price Discrimination vs. Segmenting
  • Impact on consumer surplus and deadweight loss
  • Real-world examples (Airlines, Student discounts)
  • Takeaway: Understanding how monopolies capture more surplus.

Lecture 6: Natural Monopoly & Regulation

  • Characteristics of natural monopolies (Economies of Scale)
  • Government regulation: Fair-return vs. Socially optimal pricing
  • Challenges of regulating natural monopolies
  • Takeaway: Analyzing policy responses to unavoidable monopolies.

Lecture 7: Monopolistic Competition: Characteristics

  • Many sellers, differentiated products, low barriers
  • Non-price competition (Advertising, Branding)
  • Short-run vs. Long-run equilibrium
  • Takeaway: Understanding markets with product differentiation.

Lecture 8: Monopolistic Competition: Graphical Analysis

  • Downward sloping demand for individual firms
  • Profit maximization in Short Run
  • Zero economic profit in Long Run (Entry/Exit)
  • Excess capacity theorem
  • Takeaway: Mastering the graphs for monopolistic competition.

Lecture 9: Oligopoly: Characteristics & Interdependence

  • Few sellers, identical or differentiated products, high barriers
  • Mutual interdependence and strategic behavior
  • Collusion and Cartels
  • Takeaway: Understanding markets dominated by a few large firms.

Lecture 10: Game Theory & Nash Equilibrium

  • Payoff matrices and dominant strategies
  • Nash Equilibrium identification
  • Prisoner’s Dilemma and collusion incentives
  • Takeaway: Applying game theory to oligopolistic decision-making.

MODULE 2: Factor Markets (Lectures 11-20)

Lecture 11: Introduction to Factor Markets

  • Derived demand for resources
  • Factors of production: Labor, Capital, Land
  • Profit maximization in hiring decisions
  • Takeaway: Understanding why firms demand resources.

Lecture 12: Marginal Revenue Product (MRP)

  • Definition and calculation (MP × MR)
  • MRP curve as the demand curve for labor
  • Diminishing marginal returns impact
  • Takeaway: Analyzing the value of an additional worker.

Lecture 13: Marginal Resource Cost (MRC)

  • Cost of hiring an additional unit of resource
  • Perfectly competitive labor market (MRC = Wage)
  • Profit maximizing hiring rule: MRP = MRC
  • Takeaway: Determining the optimal quantity of labor to hire.

Lecture 14: Perfectly Competitive Labor Market

  • Market demand and supply for labor
  • Equilibrium wage determination
  • Individual firm as a wage taker
  • Takeaway: Understanding wage setting in competitive labor markets.

Lecture 15: Shifts in Labor Demand & Supply

  • Determinants of Labor Demand (Product demand, Productivity, Prices of other resources)
  • Determinants of Labor Supply (Preferences, Income, Immigration)
  • Graphical analysis of shifts
  • Takeaway: Analyzing what causes wages and employment to change.

Lecture 16: Labor Market Equilibrium & Changes

  • Adjustments to equilibrium
  • Impact of minimum wage (Price Floor)
  • Surplus of labor (Unemployment)
  • Takeaway: Evaluating government intervention in labor markets.

Lecture 17: Monopsony Labor Markets

  • Single buyer of labor
  • Upward sloping labor supply curve
  • MRC lies above Supply curve
  • Takeaway: Understanding labor markets with employer power.

Lecture 18: Monopsony: Hiring & Wage Decision

  • Profit maximizing hiring rule (MRP = MRC)
  • Wage determination from Supply curve
  • Deadweight loss in monopsony
  • Takeaway: Analyzing employment and wage outcomes under monopsony.

Lecture 19: Labor Unions & Collective Bargaining

  • Goals of labor unions
  • Impact on wages and employment
  • Union vs. Non-union sectors
  • Takeaway: Evaluating the economic impact of organized labor.

Lecture 20: Module 2 Review & Quiz

  • Comprehensive review of Factor Markets
  • 15-question quiz (MCQs + Short Answer) with detailed solutions
  • Self-assessment guide and focus areas for continued study
  • Transition to Market Failure & Government Role
  • Takeaway: Ensuring mastery of labor market mechanics before studying market failure.

MODULE 3: Market Failure & Government Role (Lectures 21-27)

Lecture 21: Externalities: Negative Production

  • Definition and examples (Pollution)
  • Marginal Social Cost vs. Marginal Private Cost
  • Graphical analysis and Deadweight Loss
  • Takeaway: Understanding costs imposed on third parties.

Lecture 22: Externalities: Positive Consumption & Production

  • Examples (Education, Vaccines, R&D)
  • Marginal Social Benefit vs. Marginal Private Benefit
  • Graphical analysis and Deadweight Loss
  • Takeaway: Understanding benefits enjoyed by third parties.

Lecture 23: Government Solutions to Externalities

  • Taxes (Pigouvian) for negative externalities
  • Subsidies for positive externalities
  • Tradable permits and regulations
  • Takeaway: Evaluating policy tools to correct externalities.

Lecture 24: Public Goods & Private Goods

  • Excludable vs. Non-excludable
  • Rival vs. Non-rival
  • Four categories: Private, Public, Common, Club goods
  • Takeaway: Classifying goods based on consumption characteristics.

Lecture 25: The Free Rider Problem

  • Why private markets underprovide public goods
  • Government provision of public goods
  • Cost-benefit analysis challenges
  • Takeaway: Understanding the necessity of government intervention for public goods.

Lecture 26: Common Resources & Tragedy of the Commons

  • Overuse of non-excludable but rival resources
  • Examples: Fisheries, Clean Air, Public Grazing
  • Solutions: Property rights, quotas, taxes
  • Takeaway: Analyzing the depletion of shared resources.

Lecture 27: Income Distribution & Poverty

  • Lorenz Curve and Gini Coefficient
  • Measures of income inequality
  • Government policies for redistribution
  • Takeaway: Evaluating equity vs. efficiency in income distribution.

MODULE 4: Comprehensive Exam Preparation (Lectures 28-30)

Lecture 28: FRQ Strategies: Part 2

  • Tackling Imperfect Competition graphs
  • Game Theory matrix explanations
  • Externality correction graphs
  • Common pitfalls and point earning strategies
  • Takeaway: Mastering the free-response section for complex topics.

Lecture 29: Full AP Exam Mock Test

  • Simulated MCQ Section: 60 multiple-choice questions covering all 6 units
  • Simulated FRQ Section: 3 free-response questions (Long FRQ + 2 Short FRQs)
  • Exam conditions: Timed practice to build stamina and strategy
  • Answer key and scoring guidelines provided separately
  • Takeaway: Experiencing real exam conditions to identify strengths and areas for improvement.

Lecture 30: Final Review, Exam Strategies & Course Completion

  • Mock test solutions walkthrough and common error analysis
  • Final exam strategies: Graph labeling, Calculation showing, Terminology usage
  • Course wrap-up: Key themes across all 6 units
  • Final pep talk, certificate distribution, and next steps for college and beyond
  • Takeaway: Confidence, clarity, and readiness for exam day and lifelong learning.

📝 Part 2 Learning Outcomes

After completing Part 2, students will be able to:
✅ Analyze Imperfect Competition (Monopoly, Monopolistic Competition, Oligopoly)
✅ Apply Game Theory to strategic decision making (Nash Equilibrium)
✅ Evaluate Factor Markets (Labor Demand, MRP, MRC, Hiring Rules)
✅ Understand Monopsony labor market dynamics
✅ Assess Market Failure (Externalities, Public Goods, Common Resources)
✅ Interpret Economic Data from graphs, tables, and policy scenarios
✅ Execute AP Exam Strategies for MCQs and FRQs
✅ Complete the Full 60-Lecture Microeconomics Journey

📦 What’s Included in Part 2

  • 🎥 30 HD Video Lectures (50 Minutes Each)
  • 📄 Lecture Notes PDF (Downloadable, concise summaries for review)
  • ✍️ Practice Problem Sets (150+ questions with detailed solutions)
  • 📊 Module Quizzes (4 quizzes with instant feedback)
  • 📝 1 Full Mock Test (Simulated AP Exam conditions)
  • 🎯 Graphing Workbook (Practice with Imperfect Competition & Externalities)
  • 📚 Vocabulary Lists (Key terms for each module)
  • 💬 Priority Doubt Support (Email/WhatsApp within 24 hours)
  • 📜 Certificate of Completion (Full Course)

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