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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. 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.
inferior good
inelastic demand
hyperinflation
cyclical unemployment
2. When the percent of change in the quantity demanded equals the percent of change in price.
susbtitute goods
money multiplier
price floor
unit elastic
3. Law stating that as a price of a good increases - the quantity demanded of the good decreases - and vice versa.
inverse relationship
law of demand
opportunity cost
expenditure approach
4. Anything that shows the economy as a whole.
market economy
consumption expenditures
peak
economic aggregates
5. 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
trade surplus
consumer income rise
real GDP
depression
6. 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
oligopoly
substitution effect
expansionary monetary policy
labor force
7. 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).
depression
consumer taste and preferences
command economy
unemployment rate
8. The dollar value of production within a nation's border.
entrepreneurship
Gross Domestic Product
national economic accounts
law of demand
9. 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.
nominal GDP
substitution effect
market demand curve
stagflation
10. A shift in the demand curve resulting from consumer expectations regarding future income or future price of Goods and Services.
expenditure approach
frictional unemployment
law of demand
changes in consumer expectations
11. 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.
inferior good
normal good
unemployed
nominal GDP
12. A period of slow economic growth - usually accompanied by rising unemployment; two consecutive quarters of declining output.
consumer income rise
recession
inelastic demand
market demand curve
13. A country has a trade deficit if the value of its commodity imports exceeds the value of its commodity exports.
trade deficit
consumer income rise
inflation
Gross Domestic Product
14. Decisions of individual producers and consumers determine what how and for whom to reduce. Minor Government interference. Economy is run by itself.
market economy
complimentary goods
aggregate demand curve
opportunity cost
15. The amount of money available to consumers to purchase goods and services.
government expenditures
scarce
purchasing power
elastic demand
16. When the price of one currency falls relative to another currency - the first currency has depreciated relative to the other one.
depreciation
inferior good
market supply curve
trough
17. 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.
fiscal policy
simple money multiplier
microeconomics
cost-push inflation
18. 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
inflation
interest
land
unemployed
19. Unemployment faced by workers who have lost their jobs because of changing market (demand) conditions & who have transferable skills; unemployment due to the natural frictions of the economy.
hidden unemployment
resource
consumer taste and preferences
frictional unemployment
20. The price of a domestic currency in terms of a foreign currency.
national economic accounts
inflation
exchange rate
expansionary monetary policy
21. 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.
price index
money multiplier
hidden unemployment
Labor
22. The study of scarcity and choice.
quantity exchanged
fiscal policy
economics
government expenditures
23. The proportion of each additional dollar of income that is saved.
demand curve shifts
susbtitute goods
Marginal Propensity to Save (MPS)
inelastic
24. Consumer income rise - demand will rise.
national economic accounts
price ceiling
neutral good
monetary policy
25. 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.
consumption expenditures
susbtitute goods
structural unemployment
law of supply
26. Fluctuations in real GDP around the trend value; also called economic fluctuations.
business cycles
trade deficit
diminishing marginal utility
susbtitute goods
27. Goods that go together - if price ? the demand for both that good and complimentary good ?.
complimentary goods
total revenue
quantity exchanged
economic aggregates
28. The cost of something in terms of what one must give up to get it.
opportunity cost
hyperinflation
land
trough
29. The efforts of entrepreneurs in organizing resources for production taking risk to create new enterprises and innovating to develop new product.
recession
entrepreneurship
LRAS curv
money multiplier
30. The addition to total revenue created by selling one additional unit of ouput.
marginal revenue
trough
import quotas
direct relationship
31. A relationship between two factors in which the factors move in the same direction.
depression
Phillips curve
direct relationship
trough
32. The difference between the maximum price a consume is (or would be) willing to pay and the price he or she actually pays.
structural unemployment
elastic
consumer surplus
cyclical unemployment
33. The income earned by households and profits earned by firms after subtracting.
simple money multiplier
aggregate demand curve
command economy
national income (NI)
34. The proportion of each additional dollar of income that will go toward consumption expenditures.
Gross National Product
depreciation
cost-push inflation
marginal propensity to consume (MPC)
35. The dollar value of all the goods and services sold to house holds.
Gross National Product
government expenditures
entrepreneurship
consumption expenditures
36. Results an increase in the demand for normal goods and a decrease in the demand for inferior goods.
command economy
consumer income rise
Marginal Propensity to Save (MPS)
SRAS curve
37. A curve defining the relationship between real production and price level.
unemployed
aggregate supply curve
consumer good
elastic
38. 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.
market economy
perfectly elastic
money multiplier
opportunity cost
39. The payment that capital receives in the factor market.
opportunity cost
neutral good
nominal GDP
interest
40. A table showing quantities of a good demanded at varying prices; a table demonstrating the number of units of a good demanded at various points.
price ceiling
demand schedule
microeconomics
peak
41. An industry structure in which there is only one seller for a product.
fiscal policy
consumer surplus
monopoly
microeconomics
42. Economic tool used to determine exactly the amount of the new demand deposits that can be created from an initial deposit.
money multiplier
market equilibrium
demand-pull inflation
inflation
43. The sum of all the quantities of a good supplies by all producers at each price.
market supply curve
expenditure approach
inelastic
elastic
44. A special tax imposed on imported goods.
demand curve
tariff
opportunity cost
consumer taste and preferences
45. Long- run aggregate supply curve
demand
LRAS curv
oligopoly
complimentary goods
46. The conflict between limited resources and unlimited human wants; the basic economic problem facing all societies.
marginal revenue
scarcity
Gross National Product
oligopoly
47. 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.
demand curve shifts
economic aggregates
Ceteris Paribus (sayr-iht-us pahr-ih-bos)
direct relationship
48. Period in which a recession becomes prolonged and deep - involving high unemployment.
depression
trough
consumer taste and preferences
inflation
49. 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.
real GDP
aggregate demand curve
price ceiling
nominal GDP
50. Price control set when the market price is believed to be too low.
demand
price floor
change in quantity demanded
market equilibrium