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AP Macroeconomics

Subjects : economics, ap
Instructions:
  • Answer 50 questions in 15 minutes.
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  • 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. 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






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






3. 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).






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






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






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






7. 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).






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






9. A comprehensive group of statistics that measures various aspects of the economy's performance - net exports exports minus imports.






10. A bad depressingly prolonged recession in economic activity.






11. The income earned by households and profits earned by firms after subtracting.






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






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






14. 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.






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






16. 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).






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.






18. A shift of the demand curve resulting from a change in consumer taste and preferences.






19. A curve defining the relationship between real production and price level.






20. 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.






21. 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).






22. The proportion of each additional dollar of income that is saved.






23. Significantly responsive to a change in price.






24. 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.






25. Short-run aggregate supply curve






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






27. The efforts of entrepreneurs in organizing resources for production taking risk to create new enterprises and innovating to develop new product.






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






29. 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






30. A relationship between two factors in which the factors move in the same direction.






31. 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.






32. Not significantly responsive to changes in price.






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






34. Anything from the land and/or nature. Ex: minerals - timber - petroleum - cotton.






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






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






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






38. Law stating that as a price of a good increases - the quantity demanded of the good decreases - and vice versa.






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






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






41. Resource is unavailable in sufficient amounts to satisfy various ways society wants to use it.






42. The deliberate control of the money supply by the Federal government.






43. Consumer income rise - demand will rise.






44. Period in which the economy moves from a trough to a peak and a real GDP is increasing; also called a boom.






45. 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






46. The income of households after taxes have been paid






47. Total revenue (TR) price of a good multiplied by the number of units sold; TR = P*Q.






48. When the price of one currency falls relative to another currency - the first currency has depreciated relative to the other one.






49. 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.






50. The dollar value of goods and services sold to governments.