How to Maximize Your IB Economics Exam Review Time

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This week, I got an email from a teacher who has attended a few of my IB Economics workshops and he asked me for advice.

His question?

How should I structure my review sessions leading up to the IB exams in May?

It’s a great question because we all know review time is limited, and what you choose to focus on matters.

So I thought I’d take this week’s newsletter to share my approach to IB Economics exam review, breaking it down into Microeconomics, Macroeconomics, The Global Economy, and Market Power.

And if you’re working with 10 lessons to review, this is how I’d structure them to make sure students walk into the exam confident and prepared.

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Microeconomics: Focus on Government Intervention and Market Failure

Microeconomics is a huge section, and it’s easy to feel like you need to review everything. But here’s the truth: not all content is equally important for the IB exam.

Over the years, I’ve found that focusing on two specific areas gives students the biggest return on their review time:

• Government Intervention– Students need to master the four key diagrams that show how governments intervene in markets:
  • Indirect tax diagram
  • Subsidy diagram
  • Price ceiling diagram
  • Price floor diagram

If they fully understand these, they’ll be prepared to analyze any scenario where the government steps in to correct market outcomes.

• Market Failure – The four externality diagrams are essential. Students need to be able to explain the failures and justify the solutions—which, conveniently, tie back to the government intervention diagrams (taxes and subsidies).

Elasticities also naturally fit into this review structure because understanding elasticity helps students explain why governments tax certain goods in the first place.

So if students focus on these core diagrams, they’ll have a strong grasp of microeconomics without feeling overwhelmed.

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Macroeconomics: Anchor Everything to AD-AS and Government Objectives

For Macroeconomics, everything starts with the two AD-AS models:

• Neoclassical AD-AS Diagram
• Keynesian AD-AS Diagram

If students can draw and explain both, they can handle any question about macroeconomic conditions.

From there, I tell students to focus on three major government objectives:

• Low unemployment
• Low and stable inflation
• Economic growth

Why?

Because most macroeconomic questions on the IB exam revolve around these three issues.

Then, the next step is to focus on the policy solutions:

• Expansionary and contractionary fiscal policy
• Expansionary and contractionary monetary policy

If students can explain how these policies affect AD-AS and how they help solve unemployment, inflation, or growth problems, they will be well-prepared for most macroeconomic questions they encounter.

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The Global Economy: Be Strategic

The Global Economy includes both International Economics and Development Economics, and it’s a massive part of the syllabus. But again, not all content is equally important for review.

Here’s where I tell students to focus:

• International Economics – Free Trade & Protectionism
  • Reasons for free trade
  • Reasons for protectionism
  • The three key protectionism diagrams:
    • Protective quota diagram
    • Protective tariff diagram
    • Protective subsidy diagram

These topics always come up, and students who know these diagrams cold will be in great shape for Paper 1 and Paper 2.

• Exchange Rates & Balance of Payments
  • The exchange rate diagram
  • How exchange rates relate to the balance of payments

This is one of the most commonly tested areas, so students must be comfortable with the mechanics of currency fluctuations.

• Development Economics – The Incentives Behind Economic Development​
  Development Economics doesn’t have key diagrams like other sections, but it’s crucial that students understand why development happens (or doesn’t happen).

Three areas I have students focus on:

1. Foreign Direct Investment (FDI) – How multinational corporations invest in developing economies.
2. Government-to-government aid – Why some countries invest in others.
3. Non-Governmental Organizations (NGOs) – Their role in development.

Getting students to think about why developed nations invest in developing economies helps them understand the bigger picture of global economics.

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Market Power: Focus on Cost, Revenue, and Profit

For HL students, Market Power is a major section of the exam, and I tell them to anchor everything around cost, revenue, and profit.

The key? Mastering the four profit diagrams for each market structure:

1. Perfect competition
2. Monopoly
3. Monopolistic competition
4. Oligopoly

If students understand these diagrams and how to explain profit outcomes, they’ll be in excellent shape for any HL exam question.

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Final Thoughts

If you’re heading into exam review season, I hope this gives you a structured approach for your sessions.

To recap, here’s my strategy for breaking down exam review into four main areas:

• Microeconomics – Focus on government intervention and market failure diagrams.
• Macroeconomics – Master the AD-AS models and focus on unemployment, inflation, and growth.
• The Global Economy – Prioritize free trade, protectionism, exchange rates, and development incentives.
• Market Power – Center everything on cost, revenue, and profit diagrams.

If students lock in on these key areas, they will be ready for anything the IB exam throws at them.

Thanks to Luke for reaching out with this question—I hope this breakdown helps all of you who are prepping for exams with your Year 2 students.

See you next week.

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Whenever you are ready, here are four ways I can help:

​IB Economics Teacher Summit - June 24 to 26, 2025 - Join our new intensive, hands-on training designed specifically for IB Economics teachers. Whether you're new to IB or looking to refine your approach, this three-day experience will equip you with the knowledge, strategies, and confidence to build an effective IB Economics course from the ground up.

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