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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 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.






2. A Latin phrase meaning 'all things constant.'






3. 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






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






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






6. Long- run aggregate supply curve






7. The transition point between economic recession and recovery.






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






9. 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






10. 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.






11. 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.






12. 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.






13. 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.






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






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






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






17. 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.






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






19. The effort of workers.






20. Not significantly responsive to changes in price.






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






22. 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).






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






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






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






26. Short-run aggregate supply curve






27. 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?






28. 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.






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






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






31. The highest point of a business cycle.






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






33. 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).






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






35. 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.






36. 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.






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






38. Graphic representation of an inverse relationship between wage growth (percentage change in price level - such as inflation) and unemployment.






39. Rising prices - across the board.






40. When Price and TR move in opposite directions..... P?/TR? or P?/TR?






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






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






43. 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.






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






45. 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.






46. 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.






47. 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






48. 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).






49. The amount of a good actually sold.






50. 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.