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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. 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.






2. Occurs when supply and demand are balanced such that the market price and the quantity exchanged are under no market pressure to change.






3. A good the demand for which rises as income rises and falls as income falls; consumer income rises and demand rises.






4. The highest point of a business cycle.






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






6. 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.






7. Where the demand curve is horizontal - reflecting situation in which any change in price reduces quantity demanded to '0.' the result of a competitive market consumers will go elsewhere to purchase the product.






8. Movement up or down a single demand curve - contrasted with movement of the demand curve itself.






9. 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.






10. 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






11. The sum of each individual consumer's demand curves for a certain good in a market (e.g. - all the individual quantities of Good B demanded at each price).






12. Anything that can be used to produce something else






13. States that as prices rise - people are willing and able to buy less of a good and - hence - the quantity demanded decreases; as prices fall - people are willing and able to buy more - so the quantity demanded increases and the demand curve slopes do






14. 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.






15. Decisions by individuals about what to do and what not to do.






16. The difference between the maximum price a consume is (or would be) willing to pay and the price he or she actually pays.






17. 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.






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






19. Period in which the economy moves from a trough to a peak and a real GDP is increasing; also called a boom.






20. The transition point between economic recession and recovery.






21. Inflation that follows from an increase in aggregate demand - which will cause equilibrium real GDP (Y) to increase and the equilibrium price level (P) to increase.






22. The dollar value of production within a nation's border.






23. 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.






24. A comprehensive group of statistics that measures various aspects of the economy's performance - net exports exports minus imports.






25. 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).






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






27. The study of scarcity and choice.






28. A shift in the demand curve resulting from consumer expectations regarding future income or future price of Goods and Services.






29. When the percent of change in the quantity demanded equals the percent of change in price.






30. Rising prices - across the board.






31. The conflict between limited resources and unlimited human wants; the basic economic problem facing all societies.






32. A bad depressingly prolonged recession in economic activity.






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






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






35. Significantly responsive to a change in price.






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






37. A relationship between two factors in which the factors move in the same direction.






38. 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.






39. The proportion of each additional dollar of income that is saved.






40. The long-run pattern of growth and recession.






41. Anything that shows the economy as a whole.






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






43. Government officials make decisions about economy.






44. A type of inflation that occurs when an economy's output (real GDP decreases and its price level rises; production stagnates (as during a recession) while prices (and unemployment) go up.






45. Law stating that as a price of a good increases - the quantity demanded of the good decreases - and vice versa.






46. Economic tool used to determine exactly the amount of the new demand deposits that can be created from an initial deposit.






47. The price of a domestic currency in terms of a foreign currency.






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






49. Not significantly responsive to changes in price.






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