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

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

3. That efficiency leads to economic prosperity for all.

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

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

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

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

8. The portion of planned aggregate expenditure that is not based on output

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

10. 1 percent more unemployment results in 2 percent less output.

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

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

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

14. The output per employed worker

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

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

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

18. When people's expectations of future inflation do not change even though inflation rates change.

19. The lowest point of the recession

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

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

22. The total value of goods and services produced in a country valued at current prices.

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

24. A free market system that relies on private property ownership and supply and demand

25. 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

26. When both producers and consumers are satisfied with their quantities at market price.

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

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

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

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

31. A difference between the potential output (potential GDP) of an economy and its actual output (actual GDP)

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

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

34. 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.

35. The beginning of a recession

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

37. 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.

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

39. Government policies intended to increase spending and output.

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

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

42. The international sector emphasizes the ________ rate.

43. A record of economic increases and decreases over time.

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

45. Includes payment to the owners of tangible and intangible capital items such as: factories - machines - and copyrights.

46. The smallest dollar amount for which a seller would be willing to sell an additional unit - generally equal to marginal cost

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

48. Involves increasing a nominal quantity so that it remains unaffected by increases in inflation

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

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