The Principles of Microeconomics CLEP will test your knowledge on a myriad of topics dealing with economic principles. The test is considered one of the hardest at a level of 4, where 5 is the most difficult. Its difficulty is due to the variety of topics that will appear on the test which will judge the test takers knowledge of consumer and business topics and how the economy is affected. Free market economies as well as resource utilization are a part of the Principles of Microeconomics CLEP test. The test also examines government intervention, private industries, regulations, and the purpose and result of intervention.
Exam Day Details
On exam day students will have 90 minutes to complete an 80 question exam. The ACE recommends that a score of 50 is used to pass the Principles of Microeconomics CLEP. Check with the institution supplying credit to determine if a 50 is the passing grade. Some universities may require a slightly higher grade and others may consider it a pass/fail type of grade.
Students will need to pay $80 for the exam and an additional $20 for the sitting fee at most exam locations. There is also a possibility for members of the military to obtain tuition assistance to take the exam for free.
Helpful Exam Tips
For individuals who enjoy business topics including microeconomics as a means to earn an MBA, the test may not seem daunting. If it is a test to gain 3 credits as part of the elective core classes then it might be somewhat daunting. A lot of information is going to be required that is often very specific. One option test takers have is to start with macroeconomics and then take the microeconomics test. By taking a giant look at economies first and then narrowing it down, students often have a better handle on what the test requires. Given the last several years with economies weakening and banking sectors taking a huge hit, there will be a lot of focus on why it happened and how it could have been prevented during your studying.
Most students who take macroeconomics first obtain a better grade on microeconomics. To name a few areas of study as a way to help students, consider these:
Allocative, economic and productive efficiency
Scarcity
Comparative v. absolute advantage
Opportunity cost
Antitrust
Compliment v. substitute goods
Normal v. inferior goods
Fixed v variable costs
Marginal and average revenue
Marginal revenue product of labor
Perfect competition
Cartel
Labor supply and demand
This is just a beginning list of what students have found on the exam. There are also some more helpful hints in the exam breakdown that look at more areas of study. It is best for students to take this exam seriously and spend quite a few hours studying the different terminology and topics. The exam is multiple choice; however, it is going to be more than definitions. One has to be able to apply certain principles and even do a few calculations to determine correct answers.
As long as one uses this study guide review and the study resources named below it will be possible to make at least a 50 if not higher.
Study Resources
Several online study resources are available for this CLEP exam. Students will want to search CyberEconomics Micro portion which discusses both micro and macroeconomic topics. There is also the Concise Encyclopedia of Economics. Students should look up the University of California Micro quizzes to test one’s knowledge.
InstantCert is a forum and study guide website. Students can find a variety of flashcards and helpful hints in how to take the exam with success. There’s always the REA principles of Microeconomics CLEP book, which features tests in the back.
With regards to passing the test with success it is important to find a practice CLEP test that is considered a good example of what students will see on the day they take the exam. By taking the practice test first and then studying students will be able to figure out what they need to know and really study the points they are weakest on.
Another option for study is the Peterson guide of microeconomics. It is a comprehensive option that has helped many students pass the exam with at least a 50. Peterson Principles of Microeconomics CLEP can be found online as can about.com and Wikipedia resources to help start the learning process.
Detailed Breakdown of Exam Questions
The college board breaks this exam into four areas. The percentage and areas are shown below.
The nature and functions of product markets is on the test for amount 55 to 70 percent of the exam. The market failure and role of government is about 12 to 18 percent, while the factors market is 10% to 18%. Lastly there is a section on basic economic concepts that takes up 8 to 14 percent.
To be more specific it is important for students to examine the following areas:
Income and substitution effects
Individual and market demand curves
Utility maximization
Total utility and marginal utility
Long run costs and economies of scale
Short run costs
Cost minimizing input combination
Tax incidence and defining deadweight loss
Price, income, cross price elasticity of demand and supply
Price and quantity controls as well as the general principles of supply and demand
Equilibrium
IGame theory and strategic behavior
Monopolies
Oligopoly
Sources of market power
Profit maximization, competition and firm/market behavior
Although this is a fairly long list of different topics it is by no means complete. Students will need to delve into the study resources available to determine what else should be studied. Overall, there are plenty of helpful resources that will make it easier to take the Principles of Microeconomics CLEP.