FRQ 1 – Long

This guide organizes advice from past students who got 4s and 5s on their exams. We hope it gives you some new ideas and tools for your study sessions. But remember, everyone's different—what works for one student might not work for you. If you've got a study method that's doing the trick, stick with it. Think of this as extra help, not a must-do overhaul.

📌 Overview

• Students make assertions about economic concepts, explain principles or models, make mathematical calculations, and create graphs or visual representations
• 17% of Exam Score
• 50% of FRQ Score
• Spend about 5 minutes planning and 25 minutes responding

💭 General Advice

Tips on mindset, strategy, structure, time management, and any other high level things to know

• Use correct terminology i.e.: AD = Aggregate Demand, cost does not equal price.
• Identify & label each axis clearly for each curve.
• Explain your reasoning completely; don’t just state your answer.
• Be aware common mistakes:
  • Change in demand and supply vs. change in quantity demand and supply
  • Not labeling SRAS and LRAS, SRPC and LRPC
  • Difference between Monetary Policy and Fiscal Policy components and the effects each policy has on interest rates
  • Understand differences between real vs nominal
• Specifically, know how an increase in government borrowing can lead to higher interest rates (crowding out effect). Then you should know that this causes economic growth to slow down.

🕐 Before you Write

What should a student do in the first few minutes, before they start writing?

• Make sure you understand the prompt, read it carefully. It’s better to take some time to process what is being asked of you than to rush through it and answer the question incorrectly.
• Before writing the answer, brainstorm some things you’d like to add on a separate piece of paper. That is going to help you see how your ideas look on paper and if they sound how you’d like them to.
• See which part of the question you can answer the best and start from there.

🏛️ How to Structure your Responses

• Don’t restate the question, get straight to the point.
• Use the same outline numbers or letters from the question in your answer, and answer them in the same order.
• Try to solve all parts of a question.
• Explain your reasoning completely.
• Use graphs to explain your response.

⭐️ Most Common Equations

• Opportunity Cost
• Terms of Trade
• Output Expenditure: GDP= C + Ig + G + (X-M)
  • C = Consumer spending
  • lg = Investments
  • G = Government spending
  • (X-M) = Net Exports
• Inflation Formulas: Inflation, CPI and Deflator
• Unemployment rate and labor force participation rate
• GDP Multiplier Formulas: Spending and Tax
• Nominal and real interest rate
• Banking Formulas: Money Multiplier
• Banking Calculations: Total Reserves = Required Reserves - Excess Reserves

✏️ Drawing Graphs

• Practice, Practice, Practice, Practice! In most of the units, there’s at least one focal graph that you should know, so once you feel like you understand it, just rewrite different scenarios on that graph over and over again. You can do this by using a piece of paper and write what happens to the AS-AD curve when supply increases and decreases, and when demand increases and decreases.
• Once you’ve determined which graph you’re using from the FRQ, it’s better to label too much than too little. Label all axes, where the equilibrium point coordinates to those axes, etc. Having everything on there will also allow you to better explain the rest of the FRQ.
• ACE the graphs by labeling the following:
  • A - Axis
  • C - Curve
  • E - Equilibrium
• Shifts in the curve:
  • Show changes in each curve clearly with arrows or sequencing (ex. SRAS and SRAS’ or SRAS1 and SRAS2).
  • New intersection - include a tick or line on the horizontal and vertical lines.