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






2. The part of economics study that looks at the operation of a nation's economy as a whole






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






5. Total supply of goods and services in an economy






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






7. 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






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






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






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






11. Organizations that act as moderators between employers and employees






12. 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.






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






14. The lowest point of the recession






15. Unicorporated entity that has shared ownership.






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






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






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






19. The labor sector highlights the rate of ____ .






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






21. Payments that the government makes to unemployed workers.






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






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






24. 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






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






26. The monetary sector focuses on the ________ rate.






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






28. The maximum amount that an economy can output over a period of time






29. When the rate of inflation is extremely high.






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






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






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






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






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






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






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






37. A policy that affects potential output






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






39. 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.






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






41. Extreme economic growth






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






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






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






45. 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.






46. The slow change in inflation from year to year in industrialized nations






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






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






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

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