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AP Macroeconomics

Subjects : economics, ap
Instructions:
  • Answer 50 questions in 15 minutes.
  • If you are not ready to take this test, you can study here.
  • Match each statement with the correct term.
  • Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. Nominal GDP corrected for inflation; real GDP is calculated using prices from a given base year - which may not be the same as the year being measured or the year in which the calculations are made. Real GDP allows economists to compare changes in pr






2. The effort of workers.






3. Resource is unavailable in sufficient amounts to satisfy various ways society wants to use it.






4. The study of scarcity and choice.






5. The gross domestic product calculated using current-year prices; for example - the nominal GDP for 2001 would calculate the value of production using2001 prices for goods and services. Nominal GDP can vary widely from year to year - due to forces suc






6. When the percent of change in quantity demanded is greater than the percent of change in price; when there is a large change in the quantity of a good demanded - and a small change in price of the good.






7. Restrictions on the quantity of a good that can be imported






8. A very high rate of inflation - under which prices go up very rapidly - often more than 1 -000 percent in a year. This causes money to become a poor store of value.






9. A movement along the demand curve in response to a change in price - ceteris paribus; change in price means move along the demand curve; movement = money.






10. Fluctuations in real GDP around the trend value; also called economic fluctuations.






11. A measure of the price level - or the average level of prices.






12. 1/RRR - where RRR is the required reserve ratio expressed as a decimal; if the required reserve ratio is 10% (0.1) - the money multiplier is 1/0.1 = 10.






13. The branch of economics that deals with human behavior and choices as they relate to the entire economy.






14. The percentage of the civilian labor force that is unemployed. The number of persons unemployed divided by the number of persons in the civilian labor force (expressed as a percentage).






15. A country has a trade surplus if the value of its commodity exports exceeds the value of its commodity imports.






16. Not significantly responsive to changes in price.






17. Anything from the land and/or nature. Ex: minerals - timber - petroleum - cotton.






18. Unemployment that reflects changes in the business cycle; the difference between the official unemployment rate & the natural rate of unemployment.






19. A person who has been unemployed and searching for a job for so long - that they have given up on finding a job and therefore forfeit unemployment.






20. The proportion of each additional dollar of income that will go toward consumption expenditures.






21. A way of measuring the GDP by adding up all spending on final goods and services during a given year.






22. Monetary policy methods by which the Fed aims to increase the money supply and lower interest rates - thereby creating an increase in output; in pursuit of expansionary policy goals - the Fed can lower the required reserve ratio - lower the discount






23. A special tax imposed on imported goods.






24. Period in which a recession becomes prolonged and deep - involving high unemployment.






25. The dollar value of goods and services sold to governments.






26. Expenditure by businesses on plant and equipment and the change in business invention.






27. Results an increase in the demand for normal goods and a decrease in the demand for inferior goods.






28. The transition point between economic recession and recovery.






29. A Latin phrase meaning 'all things constant.'






30. Rising prices - across the board.






31. Inflation created when an increase in the costs of production (wages or raw materials) shifts the short-run aggregate supply (AS) curve to the left; tends to push prices up while reducing the level of real GDP at the same time (stagflation).






32. States that as the price of a good increases - the quantity supplied of a good increases - and as the price of a good decreases - the quantity supplied of the good decreases.






33. The willingness and ability of buyers to purchase a good or service.






34. Changes - adjustments - and strategies that the governments implements in spending or taxation to achieve particular economic goals.






35. The amount of money available to consumers to purchase goods and services.






36. Real cost of an item is its opportunity cost.






37. A specific percentage of checking account deposits that each bank must keep in liquid - zero-interest reserves; this amount is set by the Fed.






38. Anything that shows the economy as a whole.






39. The graphical representation of the law of demand. Shows the amount of a good buyers are willing and able to buy at various prices.






40. A country has a trade deficit if the value of its commodity imports exceeds the value of its commodity exports.






41. A relationship between two factors in which the factors move in opposite directions. ex: price increases - then quantity decreases.






42. Can be measured by using TR as a gauge; a decrease in TR following an increase in Price = Elastic Demand - When Price and TR move in opposite directions..... P?/TR? or P?/TR?






43. An industry structure in which there is only one seller for a product.






44. The sum of all the quantities of a good supplies by all producers at each price.






45. Goods that go together - if price ? the demand for both that good and complimentary good ?.






46. Will shift either to the left(decrease) in demand - or to the right(increase) in demand; shift is caused by a change in one of the non-price determinates for the good.






47. Long- run aggregate supply curve






48. The branch of economics that deals with human behavior and choices as they relate to relatively small units--the individual - the business firm - a single market.






49. When the price of one currency falls relative to another currency - the first currency has depreciated relative to the other one.






50. A good for which there is less demand as income rises; a good the demand for which falls as income rises and rises as income falls; consumer income rises while demand decreases.