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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 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.






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






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






4. Anything that shows the economy as a whole.






5. 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






6. 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






7. 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).






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






9. 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.






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






11. 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.






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






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






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






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






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






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.






18. 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






19. 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.






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






21. 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.






22. The study of scarcity and choice.






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






24. Consumer income rise - demand will rise.






25. 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.






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






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






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






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






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






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






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






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






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






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






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






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






38. 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.






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






40. 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.






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






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






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






44. A special tax imposed on imported goods.






45. Long- run aggregate supply curve






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






47. 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.






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






49. 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.






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