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






2. 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.






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






4. The gross domestic product calculated using current-year prices; for example - the nominal GDP for 2001 would calculate the value of production using2001 prices for goods and services. Nominal GDP can vary widely from year to year - due to forces suc






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






6. Results an increase in the demand for normal goods and a decrease in the demand for inferior goods.






7. Long- run aggregate supply curve






8. Anything that shows the economy as a whole.






9. 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






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






11. 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.






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






13. The sum of all the quantities of a good supplies by all producers at each price.






14. 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).






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






16. Significantly responsive to a change in price.






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






18. 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.






19. 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






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






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






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






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






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






25. The cost of something in terms of what one must give up to get it.






26. 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).






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 willingness and ability of buyers to purchase a good or service.






29. 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).






30. A market with only a few sellers - each offering a product that is largely the same as the others' products; in an oligopoly - there is always a tension between cooperation and competition.






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






32. 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.






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






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






35. 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.






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






37. The highest point of a business cycle.






38. 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.






39. 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.






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






41. Anything that can be used to produce something else






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






43. 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.






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






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






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






47. 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






48. The transition point between economic recession and recovery.






49. Consumer income rise - demand will rise.






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