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Test your basic knowledge |
CLEP Macroeconomics - 3
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Subjects
:
clep
,
economics
Instructions:
Answer 50 questions in 15 minutes.
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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. Used to demonstrate shifts in income distribution among a population over time.
Aggregate demand
Businesses
Lorenz curve
Short run equilibrium output
2. 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
Substitution bias
Market equilibrium
Price level
Marginal tax rate
3. Total supply of goods and services in an economy
Fractional
Aggregate supply
Short run equilibrium output
Substitution effect
4. The quantity of a good that results in the maximum possible economic surplus from producing and consuming the good.
Congressional budget office
Short run equilibrium output
Socially optimal quantity
Labor unions
5. Measures the ability of an economy to produce (output) goods and services in the short-term and the long-term.
Income
Expansionary policies
Aggregate Supply
Menu cost
6. 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.
Price
Law of Demand
Automatic stabilizers
Traditional economic system
7. Payments that the government makes to unemployed workers.
Phillips curve
Pay
Fractional
Unemployment insurance
8. If the Federal Reserve lowers the reserve ratio - it ______ the bank's required reserves and ______ the quantity of money.
Worker mobility
Velocity
decreases increases
LRAS
9. The tendency for nominal interest rates to be high when inflation rates are high and low when inflation rates are low.
Total surplus
Saving
Fisher effect
NRU
10. When economists fail to account for improvements in goods or services and incorrectly report inflation as higher.
Peak
Stabilization policies
Potential output
The quality adjustment bias
11. The degree to which people have access to goods and services that make their lives better.
Normative analysis
Standard of living
Tangible Assets
Consumption
12. 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).
Frictional unemployment
Asset
Expansionary policies
Aggregation
13. The government office that is responsible for projecting federal surpluses and deficits
Congressional budget office
Marginal tax rate
Boom
Stabilization policies
14. When quantity supplied is more than quantity demanded. The formula for excess supply is: Supply - Demand = Excess Supply
Automatic stabilizers
Inside lag
Excess Supply
Aggregate Supply
15. The real cost of changing a listed price.
Planned aggregate expenditure (PAE)
Law of Supply
Business cycle
Menu cost
16. Business entity which legally has no separate existence from its owner.
Inflationary gap
Sole proprietorship
Interest
Consumer Nondurables
17. A quantity that is measured in real terms - the actual quantity of a good or service
Saving
Real quantity
Rationing
Output gap
18. Includes payment to the owners of tangible and intangible capital items such as: factories - machines - and copyrights.
Capital income
Stabilization policies
Intangible Assets
Capital goods
19. The total value of goods and services produced in a country valued at current prices.
Inflation
Indexing
Consumption
Nominal GDP
20. The basic assumption of this model is that in the short run - firms meet demand at present price.
Supply-side policy
Keynesian model
Indexing
Price level
21. Goods not counted in the nation's GDP.
Automatic stabilizers
Intangible Assets
Intermediate Goods
The Wealth Effect
22. When inflation suddenly deviates from its normal course.
Worker mobility
Inflation shock
Socially optimal quantity
Real employment
23. Government policies intended to increase spending and output.
Worker mobility
decreases increases
Monetarism
Expansionary policies
24. The portion of planned aggregate expenditure that is not based on output
Sole proprietorship
Okun's Law
Autonomous Expenditure
Buyer's surplus
25. Legal entity that has received a charter from a state or federal government.
Corporation
Mixed market
Peak
Indexing
26. When goods and services are made and consumed at the best levels for the society. Nothing more can be acheived with the resources available.
Economic efficiency
Output gap
Recession
Exchange
27. The relationship between disposable income and spending on consumable goods and services
Potential output
Complement
Keynesian economic theory
Consumption function
28. A law stating that as a person consumes additional units of a good - eventually the utility gained from each additional unit of the good decreases.
Buyer's surplus
Law of Diminishing Marginal Utility
Planned aggregate expenditure (PAE)
Exchange
29. Concerned with analyzing whether or not a policy should be used.
Law of Supply
Normative analysis
Structural policy
Marginal cost
30. 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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31. Caused by changes in demand or technology. Long-term and continual unemployment that continues even though the economy is producing normally
Structural unemployment
Labor productivity
Equilibrium price
Law of Supply
32. A measure of overall price levels at a specific point in the price index.
Aggregate supply shock
Price level
Reservation price
Contractionary policies
33. A macroeconomic policy that directly affects the structure and various institutions of an economy
Structural policy
Sole proprietorship
Phillips curve
Total surplus
34. Involves increasing a nominal quantity so that it remains unaffected by increases in inflation
Indexing
Saving
Anchored inflation expectations
Capital income
35. The labor sector highlights the rate of ____ .
Relative price
Seller's surplus
Substitution effect
Pay
36. The part of economics study that looks at the operation of a nation's economy as a whole
Nominal GDP
Inflation inertia
Macroeconomics
Phillips curve
37. The opposite of a substitute good - because it usually completes another item and may lead to more consumption of that item.
Complement
Boom
Invisible hand
Sole proprietorship
38. Money multiplied by velocity equals nominal GDP.
Monetarism
Credibility of monetary policy
Inflation
Quantity equation
39. 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.
Intermediate goods
Equilibrium price
Income
Short run equilibrium output
40. The difference between the price received by the seller and the seller's reservation price
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41. The goods and services sector focuses largely on the level of ______ .
Liquidity
Socially optimal quantity
Law of Diminishing Marginal Utility
Income
42. The slow change in inflation from year to year in industrialized nations
Inflation inertia
The rate of inflation
Deflation
Structural unemployment
43. The price of a good or service in relation to the price of other goods and services.
Relative price
Businesses
Keynesian economic theory
Indexing
44. When people's expectations of future inflation do not change even though inflation rates change.
Saving
Congressional budget office
Capital income
Anchored inflation expectations
45. Maximum price that a customer is willing to pay for a good
Lorenz curve
Substitution bias
Reservation price
Peak
46. Most free-market banking systems are based on __________ reserves.
Socially optimal quantity
Intermediate Goods
Short run equilibrium output
Fractional
47. On a demand curve - the _____ of the item is placed on the vertical axis of the graph.
Traditional economic system
Velocity
Boom
Price
48. 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
Credibility of monetary policy
Substitution bias
Real GDP
Gross Domestic Product (GDP)
49. 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.
Law of Supply
Four sectors of the economy
Substitution bias
Capital goods
50. Government policies aimed at stabilizing the economy by eliminating output gaps
Cyclical unemployment
Stabilization policies
Excess Supply
Deflation
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