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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 period of slow economic growth - usually accompanied by rising unemployment; two consecutive quarters of declining output.






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






3. 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).






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






5. The income of households after taxes have been paid






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






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






8. 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.






9. A bad depressingly prolonged recession in economic activity.






10. 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.






11. (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.






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






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






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






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






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






17. The dollar value of all the goods and services sold to house holds.






18. Long- run aggregate supply curve






19. 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.






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






21. Consumer income rise - demand will rise.






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






23. 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.






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






25. 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.






26. Price control set when the market price is believed to be too low.






27. Government officials make decisions about economy.






28. 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?






29. 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.






30. Decisions of individual producers and consumers determine what how and for whom to reduce. Minor Government interference. Economy is run by itself.






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






32. The transition point between economic recession and recovery.






33. Anything that can be used to produce something else






34. The payment that capital receives in the factor market.






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






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






37. Rising prices - across the board.






38. A law stating that as an additional unit of a particular food is consumed the utility (satisfaction) gained decreases.






39. The addition to total revenue created by selling one additional unit of ouput.






40. 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.






41. Goods that compete with one another. If the price for one goes up the demand for the other will go up.






42. The dollar value of production by a country's citizens.






43. 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).






44. 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.






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






46. 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






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






48. 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.






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






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