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A concise page with just the diagrams and calculations from the microeconomics part of the syllabus. I've also made this page into free PDFs.
Certain chapters are omitted because they do not have any diagrams or calculations. Some diagrams are repeated in the syllabus, in this document they are only included under the section where they are first mentioned.
Important: On every diagram shown here, only P, Q, etc. are written as axis labels without proper units. When drawing these diagrams yourself, adapt this to the scenario you are illustrating; Write “P ($)” and “Q (units)” when discussing a US market, for example.
Diagram: Movements & shifts on the demand curve:
2.2 Supply
2.2 Supply
Diagram: The supply curve:
Diagram: Movements and shifts on the supply curve:
2.3 Equilibrium
2.3 Equilibrium
Diagram: Market equilibrium:
Diagram: Shifts in demand & supply:
Diagram: Excess demand & supply:
Diagram: Producer, consumer, and social surplus:
Calculation (HL ONLY): Producer, consumer, and social surplus:
Calculate the areas of the triangles shown above (0.5×Base×Height)
2.5 Demand Elasticity
2.5 Demand Elasticity
Calculation: Finding PED when given data:
Q^D is the quantity demanded and P is the price
We ignore negative signs we get in front of PED.
Diagram: The 5 degrees of PED:
Diagram (HL ONLY): PED along a straight line demand curve:
Calculation: Finding YED when given data:
Q^D is the quantity demanded and Y is income
Diagram: The Engel curve for the 3 types of YED:
2.6 Supply Elasticity
2.6 Supply Elasticity
Calculation: Finding PES when given data:
Q^S is the quantity demanded and P is income
Diagram: The 5 degrees of PES:
2.7 Role of Government in Microeconomics
2.7 Role of Government in Microeconomics
Diagram: Price ceilings & price floors:
Diagram: Effects price ceilings/floors have on surplus:
Calculation (HL ONLY): Effects price ceilings/floors have on surplus:
Calculate the areas of the triangles after the ceiling/floor (0.5×Base×Height) and compare with the areas before the ceiling/floor.
Diagram: Indirect taxes & subsidies:
Diagram: Effects indirect taxes/subsidies have on surplus:
Calculation (HL ONLY): Effects indirect taxes/subsidies have on surplus:
Calculate the areas of the triangles after the tax/subsidy (1/2×Base×Height) and compare with the areas before the tax/subsidy. For subsidies, remember that since the PS and CS overlap in a certain area, that area is effectively counted twice when finding the social/community surplus.
2.8 Externalities
2.8 Externalities
Diagram: The 2 positive externalities:
Diagram: The 2 negative externalities:
Calculation (HL ONLY): Welfare loss from externalities:
Calculate the areas of the welfare loss (WFL) triangles shown above (0.5×Base×Height).
Diagram: Effect of carbon taxes:
Diagram: Effect of legislation/regulation or education:
2.11 Market Power (HL ONLY)
2.11 Market Power (HL ONLY)
Calculation (HL ONLY): (1) Profit, (2) MC, (3) MR, (4) AC, (5) AR when given data:
1. Profit = TR - TC <- TR = Total Revenue, TC = Total Costs
2. MC = (Change in TC) / (Change in Q) <- Marginal Cost = Change in TC / Change in Quantity
3. MR = (Change in TR) / (Change in Q) <- Marginal Revenue = Change in TR / Change in Quantity
4. AC = (TC) / Q <- Average Cost = Total Cost / Quantity Produced
5. AR = (TR) / Q <- Average Revenue = Total Revenue / Quantity Produced
Diagram (HL ONLY): Normal profit, abnormal profit, and losses in a perfect competition:
Diagram (HL ONLY): Allocative efficiency achieved in a perfect competition, when P=MC:
Diagram (HL ONLY): Normal profit, abnormal profit, and losses in a monopoly:
Diagram (HL ONLY): Welfare loss in a monopoly:
Diagram (HL ONLY): Natural monopoly:
Diagram (HL ONLY): Collusive oligopoly acting as a monopoly:
Diagram (HL ONLY): Normal profit, abnormal profit, and losses in a monopolistic competition:
Ensure your D=AR and MR lines are less steep than in a monopoly or collusive oligopoly.
2.12 The Market's Inability to Achieve Equity (HL ONLY)
2.12 The Market's Inability to Achieve Equity (HL ONLY)
Diagram (HL ONLY): The circular flow of income:
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