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






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






3. When an economic unit makes more than it spends






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






5. The real cost of changing a listed price.






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






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






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






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






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






11. When the rate of inflation is extremely high.






12. 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






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






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






15. An increase in this would cause an increase in the aggregate supply






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






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






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






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






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






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






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






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






24. A policy that affects potential output






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






26. 1 percent more unemployment results in 2 percent less output.

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






28. The output per employed worker






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






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






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






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






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






34. 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.






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






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






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






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






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






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






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






42. Combines pure market and command. Example: Japan






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






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






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






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






47. An economic system in which all factors of production are owned and controlled by the government. Often referred to as a centrally planned economic system. Example: Former Soviet Union.






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






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






50. The labor sector highlights the rate of ____ .