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Test your basic knowledge |
AP Macroeconomics
Start Test
Study First
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. The price of a domestic currency in terms of a foreign currency.
law of supply
consumer good
LRAS curv
exchange rate
2. (population); Then there is a shift in the demand curve resulting from and increase or decrease in market demand - as specific consumption related to demographics is concerned.
price index
number of composition of consumers
inflation
depreciation
3. 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
expansionary monetary policy
land
demand curve
nominal GDP
4. The proportion of each additional dollar of income that will go toward consumption expenditures.
marginal propensity to consume (MPC)
opportunity cost
opportunity cost
labor force
5. A curve depicting the relationship between real GDP demanded (i.e. - expenditures) and the price level in the economy; the aggregate demand curve slopes downward from left to right.
aggregate demand curve
expansionary fiscal policy
law of supply
marginal revenue
6. Resource is unavailable in sufficient amounts to satisfy various ways society wants to use it.
expansion
substitution effect
monopoly
scarce
7. A bad depressingly prolonged recession in economic activity.
entrepreneurship
hidden unemployment
import quotas
depression
8. 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).
cost-push inflation
expenditure approach
substitution effect
frictional unemployment
9. 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.
cost-push inflation
demand-pull inflation
Marginal Propensity to Save (MPS)
Phillips curve
10. The group of individuals who are either working or actively looking for work; the labor force includes the unemployed: labor force = number of individuals in labor force/number of individuals in the adult population - expressed as a percentage.
labor force
business cycles
rule of 70
frictional unemployment
11. Government officials make decisions about economy.
stagflation
command economy
elastic
peak
12. Anything that can be used to produce something else
hidden unemployment
trade deficit
resource
rule of 70
13. The effort of workers.
disposable personal income
demand schedule
diminishing marginal utility
Labor
14. 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.
expansion
required reserve ratio (RRR)
money multiplier
hyperinflation
15. Long- run aggregate supply curve
number of composition of consumers
elastic demand
business cycles
LRAS curv
16. The amount of money available to consumers to purchase goods and services.
economic aggregates
purchasing power
consumer taste and preferences
money multiplier
17. The dollar value of all the goods and services sold to house holds.
complimentary goods
changes in consumer expectations
consumption expenditures
consumer taste and preferences
18. 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
demand-pull inflation
price index
scarce
real GDP
19. 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?
demand schedule
demand elasticity
unit elastic
national income (NI)
20. Movement up or down a single demand curve - contrasted with movement of the demand curve itself.
susbtitute goods
Phillips curve
market equilibrium
movement along a demand curve
21. The highest point of a business cycle.
peak
unemployed
demand
expansionary monetary policy
22. When consumers substitute a similar - lower priced product for a product which is relatively more expensive.
demand schedule
disposable personal income
recession
substitution effect
23. A shift in the demand curve resulting from consumer expectations regarding future income or future price of Goods and Services.
number of composition of consumers
changes in consumer expectations
complimentary goods
inelastic demand
24. The difference between the maximum price a consume is (or would be) willing to pay and the price he or she actually pays.
demand elasticity
trade surplus
consumer surplus
structural unemployment
25. Economic tool used to determine exactly the amount of the new demand deposits that can be created from an initial deposit.
marginal revenue
unit elastic
money multiplier
business cycle
26. Real cost of an item is its opportunity cost.
entrepreneurship
price ceiling
Labor
opportunity cost
27. 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.
trough
elastic demand
tariff
inverse relationship
28. 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.
SRAS curve
law of supply
consumer good
hidden unemployment
29. 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).
substitution effect
market equilibrium
market demand curve
consumer income rise
30. The addition to total revenue created by selling one additional unit of ouput.
marginal revenue
trough
market equilibrium
monetary policy
31. A relationship between two factors in which the factors move in opposite directions. ex: price increases - then quantity decreases.
inverse relationship
expansionary monetary policy
business cycle
cost-push inflation
32. Anything from the land and/or nature. Ex: minerals - timber - petroleum - cotton.
inflation
investment expenditures
land
number of composition of consumers
33. A civilian - non-institutionalized adult is considered to be unemployed when he or she does not have a job but is actively looking for one; unemployment figures reflect the number of individuals meeting this definition who are parts of the labor forc
unemployed
movement along a demand curve
frictional unemployment
unit elastic
34. 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
expansionary monetary policy
neutral good
inflation
marginal propensity to consume (MPC)
35. Graphic representation of an inverse relationship between wage growth (percentage change in price level - such as inflation) and unemployment.
substitution effect
Phillips curve
depression
business cycles
36. 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.
investment expenditures
cyclical unemployment
perfectly elastic
consumer good
37. The branch of economics that deals with human behavior and choices as they relate to the entire economy.
consumer good
changes in consumer expectations
macroeconomics
aggregate supply curve
38. An increase or decrease in consumer income will cause a shift in the Demand Curve.
trade deficit
consumer good
normal good
demand curve
39. A relationship between two factors in which the factors move in the same direction.
direct relationship
Labor
import quotas
total revenue
40. The dollar value of production within a nation's border.
aggregate supply curve
Gross Domestic Product
resource
government expenditures
41. When the price of one currency falls relative to another currency - the first currency has depreciated relative to the other one.
inelastic demand
demand
market demand curve
depreciation
42. Goods that compete with one another. If the price for one goes up the demand for the other will go up.
business cycles
susbtitute goods
trough
individual choice
43. Results an increase in the demand for normal goods and a decrease in the demand for inferior goods.
consumer income rise
price ceiling
trade deficit
inelastic demand
44. When the percent of change in the quantity demanded equals the percent of change in price.
unemployed
unit elastic
scarcity
interest
45. A curve defining the relationship between real production and price level.
inflation
cyclical unemployment
marginal propensity to consume (MPC)
aggregate supply curve
46. The deliberate control of the money supply by the Federal government.
monetary policy
trade deficit
aggregate supply curve
opportunity cost
47. The conflict between limited resources and unlimited human wants; the basic economic problem facing all societies.
scarcity
market equilibrium
frictional unemployment
nominal GDP
48. Total revenue (TR) price of a good multiplied by the number of units sold; TR = P*Q.
frictional unemployment
law of demand
economics
total revenue
49. The graphical representation of the law of demand. Shows the amount of a good buyers are willing and able to buy at various prices.
demand curve
business cycle
disposable personal income
expenditure approach
50. The dollar value of production by a country's citizens.
monopoly
Gross National Product
business cycle
law of supply