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CLEP Macroeconomics - 3

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. 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.






2. Goods and services sector - Labor sector - monetary sector - international sector.






3. The annual percentage rate of change in price level reflected by price indexes






4. The labor sector highlights the rate of ____ .






5. A policy that affects potential output






6. 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.






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






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






9. When quantity supplied is more than quantity demanded. The formula for excess supply is: Supply - Demand = Excess Supply






10. Extreme economic growth






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






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






13. Gross domestic product adjusted for inflation; gross domestic product in a year divided by the GDP price index for that year - the index expressed as a decimal






14. The output per employed worker






15. Maximum price that a customer is willing to pay for a good






16. There is an ___________ ___ when aggregate output is above potential output






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






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






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






20. 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






21. Patents - Goodwill - and Trademarks (lack physical substance)






22. A flaw in the CPI that exaggerates real increases in the cost of living by failing to take into account customers ability to choose equally desirable goods or services when the price of their preferred good or service increases






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






24. 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.






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






26. Organizations that act as moderators between employers and employees






27. The time period between a policy's implementation and its desired effects on an economy.






28. The lowest point of the recession






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






30. On a demand curve - the _____ of the item is placed on the vertical axis of the graph.






31. The increase in total cost that comes from producing one additional unit of a specific good or service.






32. The international sector emphasizes the ________ rate.






33. Most free-market banking systems are based on __________ reserves.






34. The ease with which an asset can be converted to currency.






35. The rate of price increase on all things except food and energy






36. Real Estate - Equipment - and Cash (physical assets)






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






38. Distributing a good or resource among consumers that would like to have more of that good or resource than is made available






39. The opposite of a substitute good - because it usually completes another item and may lead to more consumption of that item.






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






41. Natural Rate of Unemployment - a rate that will always exist






42. An extreme decline in the rate of inflation. Can lead to high levels of unemployment and recessionary gaps.






43. (n) something of value; a resource; an advantage






44. An increase in spending due to a perceived increase in wealth.






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






46. Goods like food and clothing that have a short lifespan.






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






48. The goods and services sector focuses largely on the level of ______ .






49. 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.






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