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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. When goods and services are made and consumed at the best levels for the society. Nothing more can be acheived with the resources available.






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






4. Payments that the government makes to unemployed workers.






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






6. When the rate of inflation is extremely high.






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






8. A large - unexpected change in the cost of resources.






9. The total demand for a country's output. It includes demands for consumption - investment - government purchases - and net exports.






10. Caused by changes in the overall economy.






11. The international sector emphasizes the ________ rate.






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






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






14. 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.






15. Legal entity that has received a charter from a state or federal government.






16. Extreme economic growth






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






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






19. A GDP decline that lasts two-quarters (six months). A period of slow economic growth






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






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






22. 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).






23. Used in the production of final goods - but instead of being consumed - are available for reuse.






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






25. Combines pure market and command. Example: Japan






26. Economies based on capitalism have microeconomic instability and that government is required to properly stabilize the economy.






27. Money multiplied by velocity equals nominal GDP.






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






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






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






31. The adding up of individual economic variables to obtain a large - general picture of the economy.






32. 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.






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






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






35. When an economic unit makes more than it spends






36. When inflation suddenly deviates from its normal course.






37. The labor sector highlights the rate of ____ .






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






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






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






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






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






43. A policy that affects potential output






44. The law that states that as the price of any good or service increases - the quantity of that good or service will increase and vice versa.






45. 1 percent more unemployment results in 2 percent less output.

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






47. Long Run Aggregate Supply - The natural level of GDP - shown vertical on a graph. When LRAS shifts - SRAS (Short Run Aggregate Supply) will follow .






48. Government policies intended to increase spending and output.






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






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