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CLEP Macroeconomics - 3

Subjects : clep, economics
  • Answer 50 questions in 15 minutes.
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  • Match each statement with the correct term.
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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. Government policies aimed at stabilizing the economy by eliminating output gaps

2. When prices fall consistently over time - leading to negative inflation.

3. The level of output where output equals planned aggregate expenditure

4. The difference between the price received by the seller and the seller's reservation price

5. A quantity that is measured in real terms - the actual quantity of a good or service

6. Unicorporated entity that has shared ownership.

7. The quantity of a good that results in the maximum possible economic surplus from producing and consuming the good.

8. The maximum amount that an economy can output over a period of time

9. Can be found by multiplying the average labor productivity by the percentage of people that are working in the economy.

10. A phrase coined by Adam Smith to describe the process that turns self directed gain into social and economic benefits for all.

11. Extreme economic growth

12. Economic rule stating that if two items satisfy the same need and the price of one rises - people will buy the other.

13. 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.

14. The lowest point of the recession

15. The increase in total benefit that comes from producing one additional unit.

16. The price of a good or service in relation to the price of other goods and services.

17. The movement of workers between jobs - companies - and industries

18. Represents the governmental tax rate that will best maximize tax revenues.

19. If the Federal Reserve lowers the reserve ratio - it ______ the bank's required reserves and ______ the quantity of money.

20. Caused by changes in the overall economy.

21. Short-run macroeconomic equilibrium occurs at the level of GDP where the:

22. The degree to which people have access to goods and services that make their lives better.

23. The amount spent by a household on goods and services such as: entertainment - food - and other perishables.

24. Business entity which legally has no separate existence from its owner.

25. The output per employed worker

26. The beginning of a recession

27. Measures the ability of an economy to produce (output) goods and services in the short-term and the long-term.

28. A market with unrestricted trading of goods - where the prices of goods are determined by supply and demand.

29. 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.

30. The speed that money changes hands in order to buy and sell final goods and services.

31. A macroeconomic policy that directly affects the structure and various institutions of an economy

32. Goods that are used in the production of final goods.

33. Goods not counted in the nation's GDP.

34. The real cost of changing a listed price.

35. The rise in taxes that occurs when before-tax income increases by one dollar

36. Sole proprietorships - partnerships - and corporations are private producing units of the economy knows as __________.

37. The percentage of working-age people within the labor force

38. When the people believe that the nation's central bank will keep inflation rates low.

39. The difference between the buyer's reservation price and the seller's reservation price. Consumer surplus + Producer surplus

40. Caused by changes in demand or technology. Long-term and continual unemployment that continues even though the economy is producing normally

41. That efficiency leads to economic prosperity for all.

42. The labor sector highlights the rate of ____ .

43. The difference between a buyer's reservation price (the price they want to pay) and the actual price paid for a good or service

44. The relationship between disposable income and spending on consumable goods and services

45. Total tax paid divided by total (taxable) income - as a percentage.

46. The basic assumption of this model is that in the short run - firms meet demand at present price.

47. Organizations that act as moderators between employers and employees

48. The tendency for nominal interest rates to be high when inflation rates are high and low when inflation rates are low.

49. 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.

50. The government office that is responsible for projecting federal surpluses and deficits