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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. 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.
demand-pull inflation
frictional unemployment
quantity exchanged
SRAS curve
2. Anything that shows the economy as a whole.
economic aggregates
real GDP
expansionary monetary policy
total revenue
3. Total revenue (TR) price of a good multiplied by the number of units sold; TR = P*Q.
total revenue
hidden unemployment
Marginal Propensity to Save (MPS)
unemployed
4. 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.
expenditure approach
trade surplus
elastic demand
SRAS curve
5. 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.
consumer income rise
change in quantity demanded
Marginal Propensity to Save (MPS)
substitution effect
6. Mathematical approximation used to measure the effect of economic growth; this rule tells us the approximate number of years it will take for some measure (real GDP - price level - savings account - etc.) to double given a known annual percentage inc
market economy
disposable personal income
rule of 70
market demand curve
7. Goods that compete with one another. If the price for one goes up the demand for the other will go up.
demand-pull inflation
Gross Domestic Product
susbtitute goods
interest
8. Movement up or down a single demand curve - contrasted with movement of the demand curve itself.
movement along a demand curve
elastic
fiscal policy
macroeconomics
9. A measure of the price level - or the average level of prices.
price index
trade surplus
number of composition of consumers
change in quantity demanded
10. Government officials make decisions about economy.
command economy
stagflation
complimentary goods
exchange rate
11. The dollar value of all the goods and services sold to house holds.
consumption expenditures
required reserve ratio (RRR)
cyclical unemployment
inelastic demand
12. Enacted when the government deliberately increases its deficit to stimulate the economy; the government increases its spending (increases G) - cuts taxes (decreases T) - or both - and stimulates the economy by expanding aggregate demand (AD).
cost-push inflation
expansionary fiscal policy
resource
oligopoly
13. A relationship between two factors in which the factors move in the same direction.
consumer good
direct relationship
substitution effect
changes in consumer expectations
14. 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
interest
macroeconomics
real GDP
15. 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
structural unemployment
elastic
unemployed
consumer surplus
16. Period in which a recession becomes prolonged and deep - involving high unemployment.
market supply curve
depression
Gross National Product
macroeconomics
17. 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.
depreciation
hyperinflation
demand-pull inflation
structural unemployment
18. 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.
Gross Domestic Product
stagflation
individual choice
demand-pull inflation
19. Decisions of individual producers and consumers determine what how and for whom to reduce. Minor Government interference. Economy is run by itself.
market economy
movement along a demand curve
required reserve ratio (RRR)
demand-pull inflation
20. An industry structure in which there is only one seller for a product.
susbtitute goods
demand schedule
monopoly
recession
21. The study of scarcity and choice.
economics
market equilibrium
diminishing marginal utility
macroeconomics
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
purchasing power
market supply curve
scarcity
expansionary monetary policy
23. Restrictions on the quantity of a good that can be imported
import quotas
resource
inflation
cost-push inflation
24. Unemployment faced by workers who have lost their jobs because of changing market (demand) conditions & whose skills don't match the requirements of available jobs.
structural unemployment
tariff
scarce
opportunity cost
25. An increase or decrease in consumer income will cause a shift in the Demand Curve.
monetary policy
consumer good
government expenditures
interest
26. 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.
hidden unemployment
change in quantity demanded
expenditure approach
market demand curve
27. 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.
individual choice
consumption expenditures
inelastic demand
frictional unemployment
28. When the percent of change in the quantity demanded equals the percent of change in price.
real GDP
entrepreneurship
unit elastic
changes in consumer expectations
29. Fluctuations in real GDP around the trend value; also called economic fluctuations.
trade surplus
depreciation
aggregate demand curve
business cycles
30. Consumer income rise - demand will rise.
total revenue
neutral good
economics
law of demand
31. When the price of one currency falls relative to another currency - the first currency has depreciated relative to the other one.
depreciation
tariff
labor force
elastic
32. Unemployment that reflects changes in the business cycle; the difference between the official unemployment rate & the natural rate of unemployment.
trough
cyclical unemployment
command economy
marginal revenue
33. The transition point between economic recession and recovery.
price floor
command economy
trough
monetary policy
34. Economic tool used to determine exactly the amount of the new demand deposits that can be created from an initial deposit.
disposable personal income
consumer income rise
depreciation
money multiplier
35. 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
hidden unemployment
real GDP
recession
36. Occurs when supply and demand are balanced such that the market price and the quantity exchanged are under no market pressure to change.
demand schedule
entrepreneurship
consumer income rise
market equilibrium
37. The amount of money available to consumers to purchase goods and services.
unemployed
purchasing power
entrepreneurship
SRAS curve
38. Real cost of an item is its opportunity cost.
opportunity cost
disposable personal income
purchasing power
movement along a demand curve
39. 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?
inelastic
disposable personal income
consumer income rise
demand elasticity
40. 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).
opportunity cost
cyclical unemployment
Gross Domestic Product
cost-push inflation
41. 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
expansionary monetary policy
real GDP
neutral good
Marginal Propensity to Save (MPS)
42. Graphic representation of an inverse relationship between wage growth (percentage change in price level - such as inflation) and unemployment.
trade deficit
economics
Phillips curve
expansionary fiscal policy
43. A good the demand for which rises as income rises and falls as income falls; consumer income rises and demand rises.
Gross National Product
normal good
cyclical unemployment
price index
44. The addition to total revenue created by selling one additional unit of ouput.
macroeconomics
business cycles
marginal revenue
unemployment rate
45. An increase in the price level
inflation
Gross National Product
recession
trade surplus
46. A country has a trade surplus if the value of its commodity exports exceeds the value of its commodity imports.
hidden unemployment
trade surplus
price floor
market equilibrium
47. Expenditure by businesses on plant and equipment and the change in business invention.
investment expenditures
unit elastic
economics
rule of 70
48. A comprehensive group of statistics that measures various aspects of the economy's performance - net exports exports minus imports.
trade surplus
demand
national economic accounts
expansionary monetary policy
49. A specific percentage of checking account deposits that each bank must keep in liquid - zero-interest reserves; this amount is set by the Fed.
business cycles
complimentary goods
required reserve ratio (RRR)
market demand curve
50. The proportion of each additional dollar of income that will go toward consumption expenditures.
scarcity
marginal propensity to consume (MPC)
Gross National Product
frictional unemployment