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Test your basic knowledge |
CLEP Macroeconomics - 3
Start Test
Study First
Subjects
:
clep
,
economics
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 phrase coined by Adam Smith to describe the process that turns self directed gain into social and economic benefits for all.
Contractionary policies
Disinflation
Reservation price
Invisible hand
2. An increase in this would cause an increase in the aggregate supply
The rate of inflation
Autonomous Expenditure
Labor productivity
Interest
3. The total value of goods and services produced in a country valued at current prices.
Sunk cost
Menu cost
Nominal GDP
Phillips curve
4. A Scottish man (1723-1790) who is known as the father of modern economics.
Economic efficiency
Buyer's surplus
Market equilibrium
Adam Smith
5. Total supply of goods and services in an economy
Aggregate supply
Capital goods
Marginal tax rate
Standard of living
6. An increase in spending due to a perceived increase in wealth.
Unemployment insurance
Complement
Anchored inflation expectations
The Wealth Effect
7. Goods and services sector - Labor sector - monetary sector - international sector.
LRAS
Law of Supply
Four sectors of the economy
Traditional economic system
8. The level of output where output equals planned aggregate expenditure
Short run equilibrium output
Fisher effect
The Wealth Effect
Aggregation
9. When the people believe that the nation's central bank will keep inflation rates low.
Disinflation
Credibility of monetary policy
Menu cost
Structural policy
10. Programs and economic policies such as income taxes - unemployment insurance and TANF (Temporary Aid to Needy Families) that are automatically in place - help to decrease fluctuations in the GDP.
Congressional budget office
Economic efficiency
Automatic stabilizers
Rationing
11. A measure of overall price levels at a specific point in the price index.
Price level
Quantity equation
Income
Gross National Product (GNP)
12. A record of economic increases and decreases over time.
Congressional budget office
Law of Demand
Business cycle
Contractionary policies
13. The percentage of working-age people within the labor force
Participation rate
Policy reaction function
Complement
LRAS
14. A market with unrestricted trading of goods - where the prices of goods are determined by supply and demand.
Liquidity
Mixed market
Free market
Automatic stabilizers
15. Goods like food and clothing that have a short lifespan.
Substitution bias
Sole proprietorship
Consumer Nondurables
Intermediate Goods
16. The difference between a buyer's reservation price (the price they want to pay) and the actual price paid for a good or service
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17. The adding up of individual economic variables to obtain a large - general picture of the economy.
Normative analysis
Aggregation
Seller's surplus
Gross Domestic Product (GDP)
18. The beginning of a recession
Autonomous Expenditure
Peak
Expansionary policies
Corporation
19. A cost that is beyond recovery the moment a consumer decides to purchase a certain good or service is made
Anchored inflation expectations
Command economic system
Capitalism
Sunk cost
20. The annual percentage rate of change in price level reflected by price indexes
Businesses
Command economic system
The quality adjustment bias
The rate of inflation
21. The part of economics study that looks at the operation of a nation's economy as a whole
Inflation shock
Invisible hand
Socially optimal quantity
Macroeconomics
22. The economic theory that states the main cause of change in aggregate output and price level is the result of monetary supply and the interest rate that comes from the amount of monetary supply
Free market
Invisible hand
Monetarism
Lorenz curve
23. If the Federal Reserve lowers the reserve ratio - it ______ the bank's required reserves and ______ the quantity of money.
Economic efficiency
Asset
decreases increases
Inside lag
24. Total tax paid divided by total (taxable) income - as a percentage.
Inflation inertia
Average tax rate
Seller's surplus
Expansionary policies
25. Unicorporated entity that has shared ownership.
Real quantity
Intermediate Goods
Partnership
Credibility of monetary policy
26. Government policies intended to avoid inflation and other effects due to increased expansion. Includes: Action such as decreasing government spending - increasing taxes - and decreasing the supply of money - and raising interest rates.
decreases increases
Structural policy
Normative analysis
Contractionary policies
27. The continuing increase in the average level of prices of goods and services over time.
Exchange
Substitution effect
Nominal GDP
Inflation
28. A result of there only being one buyer of a resource input - good - or service.
Policy reaction function
Price
Monopsony
AD curve intersects the SAS curve
29. When the rate of inflation is extremely high.
Complement
Hyperinflation
Pay
Velocity
30. Is equal to Consumption + Government Expenditures + Investment + Exports - Imports The market value of all goods and services produced within a nation during a specified amount of time.
The quality adjustment bias
Gross Domestic Product (GDP)
Liquidity
Substitution bias
31. The price at which the number of products that businesses are willing to supply equals the amount of products that consumers are willing to buy at a specific point in time.
Income
Equilibrium price
Partnership
Unemployment insurance
32. Caused by changes in the overall economy.
Indexing
Cyclical unemployment
Aggregate supply shock
Congressional budget office
33. The maximum amount that an economy can output over a period of time
Potential output
Inflationary gap
Disinflation
Excess Supply
34. When people's expectations of future inflation do not change even though inflation rates change.
Excess Supply
Unemployment insurance
Potential output
Anchored inflation expectations
35. The time between the need for a macroeconomic policy and its implementation
Inside lag
Real quantity
Short run equilibrium output
Average tax rate
36. Government policies intended to increase spending and output.
Inflationary gap
Expansionary policies
Congressional budget office
Credibility of monetary policy
37. The portion of planned aggregate expenditure that is not based on output
Inflation shock
Autonomous Expenditure
Credibility of monetary policy
AD curve intersects the SAS curve
38. The smallest dollar amount for which a seller would be willing to sell an additional unit - generally equal to marginal cost
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39. In a traditional economic system - the availability of resources is based on inheritance. Goods are only produced for consumption and surpluses do not occur. This type of economy is normally found in South American - Asian - and African countries.
Recession
Labor productivity
The rate of inflation
Traditional economic system
40. A free market system that relies on private property ownership and supply and demand
Boom
Planned aggregate expenditure (PAE)
Capitalism
Autonomous Expenditure
41. Money multiplied by velocity equals nominal GDP.
Rationing
Quantity equation
Labor productivity
Menu cost
42. The time period between a policy's implementation and its desired effects on an economy.
Consumption function
Outside lag
Invisible hand
Frictional unemployment
43. Business entity which legally has no separate existence from its owner.
Capital goods
Sole proprietorship
Aggregate demand
Deflation
44. When there is no cyclical unemployment and every person who wishes to work is able to find a job at the prevailing rate for wages and in the prevailing working conditions.
Price
Sunk cost
Disinflation
Real employment
45. The difference between the buyer's reservation price and the seller's reservation price. Consumer surplus + Producer surplus
Disinflation
Buyer's surplus
Labor productivity
Total surplus
46. An economic system in which all factors of production are owned and controlled by the government. Often referred to as a centrally planned economic system. Example: Former Soviet Union.
Reservation price
Core rate of inflation
Command economic system
Interest
47. The lowest point of the recession
Inflation
Trough
Seller's surplus
Substitution effect
48. A law stating that as the price of a product increases the demand of that product decreases - while if the price of a product decreases the demand for that product increases.
Saving
AD curve intersects the SAS curve
Law of Demand
Inflation
49. Natural Rate of Unemployment - a rate that will always exist
NRU
Participation rate
Indexing
Labor productivity
50. Can be found by multiplying the average labor productivity by the percentage of people that are working in the economy.
The real GDP per person
Potential output
Output gap
Corporation