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






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






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






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






5. Refers to individuals between jobs seeking new employment - people re-entering the workforce (ie mom whose kids are grown) - and new entrants (ie college graduates).






6. The lowest point of the recession






7. Describes how the economy directly effects the actions policymakers take.






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






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






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






11. Used to demonstrate shifts in income distribution among a population over time.






12. The amount of workers that are willing to work for a real wage.






13. Government policies intended to increase spending and output.






14. 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.






15. That efficiency leads to economic prosperity for all.






16. Government policies aimed at stabilizing the economy by eliminating output gaps






17. Total supply of goods and services in an economy






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






19. The output per employed worker






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






21. Money multiplied by velocity equals nominal GDP.






22. Concerned with analyzing whether or not a policy should be used.






23. 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.






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






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






26. A Scottish man (1723-1790) who is known as the father of modern economics.






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






28. The labor sector highlights the rate of ____ .






29. When the rate of inflation is extremely high.






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






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






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






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






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






35. 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.






36. 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.






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






38. The continuing increase in the average level of prices of goods and services over time.






39. Demonstrates that there is an inverse relationship between inflation and unemployment; as inflation increases - unemployment decreases (and vice versa).






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






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






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






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






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






45. A cost that is beyond recovery the moment a consumer decides to purchase a certain good or service is made






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






47. The time between the need for a macroeconomic policy and its implementation






48. When economists fail to account for improvements in goods or services and incorrectly report inflation as higher.






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






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