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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. Results an increase in the demand for normal goods and a decrease in the demand for inferior goods.
interest
consumer income rise
real GDP
peak
2. The study of scarcity and choice.
law of demand
consumer taste and preferences
economics
expansionary fiscal policy
3. 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).
normal good
unemployment rate
expansionary monetary policy
business cycle
4. A good the demand for which rises as income rises and falls as income falls; consumer income rises and demand rises.
normal good
demand curve
labor force
interest
5. The lowest point of a business cycle
monopoly
trough
inelastic
perfectly elastic
6. A way of measuring the GDP by adding up all spending on final goods and services during a given year.
elastic demand
aggregate demand curve
monopoly
expenditure approach
7. The dollar value of production by a country's citizens.
hyperinflation
consumer income rise
Gross National Product
inverse relationship
8. The transition point between economic recession and recovery.
quantity exchanged
perfectly elastic
trough
rule of 70
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.
demand-pull inflation
aggregate supply curve
oligopoly
diminishing marginal utility
10. 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.
economic aggregates
marginal propensity to consume (MPC)
cyclical unemployment
change in quantity demanded
11. An increase in the price level
government expenditures
opportunity cost
expenditure approach
inflation
12. Unemployment that reflects changes in the business cycle; the difference between the official unemployment rate & the natural rate of unemployment.
price floor
frictional unemployment
cyclical unemployment
demand curve
13. When the price of one currency falls relative to another currency - the first currency has depreciated relative to the other one.
movement along a demand curve
depreciation
national economic accounts
Marginal Propensity to Save (MPS)
14. A relationship between two factors in which the factors move in the same direction.
Marginal Propensity to Save (MPS)
business cycle
expansionary monetary policy
direct relationship
15. 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.
required reserve ratio (RRR)
demand schedule
hidden unemployment
business cycle
16. A law stating that as an additional unit of a particular food is consumed the utility (satisfaction) gained decreases.
expansionary monetary policy
diminishing marginal utility
peak
total revenue
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.
money multiplier
simple money multiplier
investment expenditures
oligopoly
18. A period of slow economic growth - usually accompanied by rising unemployment; two consecutive quarters of declining output.
recession
depression
SRAS curve
trough
19. The amount of money available to consumers to purchase goods and services.
purchasing power
price index
required reserve ratio (RRR)
real GDP
20. A country has a trade deficit if the value of its commodity imports exceeds the value of its commodity exports.
trade surplus
trade deficit
inflation
expansion
21. Law stating that as a price of a good increases - the quantity demanded of the good decreases - and vice versa.
cyclical unemployment
business cycle
individual choice
law of demand
22. The proportion of each additional dollar of income that is saved.
Marginal Propensity to Save (MPS)
market supply curve
changes in consumer expectations
trade deficit
23. 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
demand-pull inflation
trough
land
rule of 70
24. Expenditure by businesses on plant and equipment and the change in business invention.
structural unemployment
marginal revenue
law of demand
investment expenditures
25. 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?
simple money multiplier
consumer income rise
hidden unemployment
demand elasticity
26. Government officials make decisions about economy.
inflation
command economy
inferior good
direct relationship
27. Period in which a recession becomes prolonged and deep - involving high unemployment.
demand schedule
aggregate supply curve
expansionary fiscal policy
depression
28. The highest point of a business cycle.
peak
elastic
unemployment rate
opportunity cost
29. A shift in the demand curve resulting from consumer expectations regarding future income or future price of Goods and Services.
depreciation
SRAS curve
law of demand
changes in consumer expectations
30. The proportion of each additional dollar of income that will go toward consumption expenditures.
consumer good
marginal propensity to consume (MPC)
number of composition of consumers
investment expenditures
31. The amount of a good actually sold.
unemployment rate
business cycles
market equilibrium
quantity exchanged
32. 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).
scarcity
expansionary fiscal policy
inferior good
expenditure approach
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
Labor
normal good
unemployed
rule of 70
34. Economic tool used to determine exactly the amount of the new demand deposits that can be created from an initial deposit.
Gross National Product
money multiplier
hidden unemployment
scarce
35. The addition to total revenue created by selling one additional unit of ouput.
macroeconomics
monetary policy
depreciation
marginal revenue
36. When Price and TR move in opposite directions..... P?/TR? or P?/TR?
A decrease in TR following an increase in price = elastic demand
expansionary fiscal policy
demand elasticity
trade surplus
37. The income earned by households and profits earned by firms after subtracting.
national income (NI)
movement along a demand curve
government expenditures
inflation
38. The dollar value of all the goods and services sold to house holds.
trade deficit
consumption expenditures
cost-push inflation
stagflation
39. Graphic representation of an inverse relationship between wage growth (percentage change in price level - such as inflation) and unemployment.
market economy
money multiplier
interest
Phillips curve
40. When the percent of change in the quantity demanded equals the percent of change in price.
aggregate supply curve
unit elastic
market economy
rule of 70
41. Anything that shows the economy as a whole.
Ceteris Paribus (sayr-iht-us pahr-ih-bos)
total revenue
economic aggregates
rule of 70
42. An industry structure in which there is only one seller for a product.
national economic accounts
exchange rate
monopoly
business cycles
43. A country has a trade surplus if the value of its commodity exports exceeds the value of its commodity imports.
unemployment rate
trade surplus
price index
SRAS curve
44. Consumer income rise - demand will rise.
labor force
inelastic
neutral good
national income (NI)
45. A specific percentage of checking account deposits that each bank must keep in liquid - zero-interest reserves; this amount is set by the Fed.
required reserve ratio (RRR)
market supply curve
individual choice
cyclical unemployment
46. A shift of the demand curve resulting from a change in consumer taste and preferences.
consumer taste and preferences
Gross National Product
market economy
required reserve ratio (RRR)
47. Occurs when supply and demand are balanced such that the market price and the quantity exchanged are under no market pressure to change.
market equilibrium
inflation
aggregate supply curve
peak
48. Resource is unavailable in sufficient amounts to satisfy various ways society wants to use it.
cost-push inflation
Marginal Propensity to Save (MPS)
scarce
hyperinflation
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
consumption expenditures
trough
Phillips curve
50. Period in which the economy moves from a trough to a peak and a real GDP is increasing; also called a boom.
Gross National Product
expansionary fiscal policy
simple money multiplier
expansion