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






2. 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.






3. Government policies intended to increase spending and output.






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






5. 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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6. 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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7. Demonstrates that there is an inverse relationship between inflation and unemployment; as inflation increases - unemployment decreases (and vice versa).






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






9. 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).






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






11. Is equal to Consumption + Government Expenditures + Investment + Exports - Imports The market value of all goods and services produced within a nation during a specified amount of time.






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






14. Concerned with analyzing whether or not a policy should be used.






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






16. 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






17. Patents - Goodwill - and Trademarks (lack physical substance)






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






19. Goods like food and clothing that have a short lifespan.






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






21. Money multiplied by velocity equals nominal GDP.






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






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






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






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






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






27. The difference between the buyer's reservation price and the seller's reservation price. Consumer surplus + Producer surplus






28. When an economic unit makes more than it spends






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






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






31. Unicorporated entity that has shared ownership.






32. Can be found by multiplying the average labor productivity by the percentage of people that are working in the economy.






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






34. Caused by changes in the overall economy.






35. Programs and economic policies such as income taxes - unemployment insurance and TANF (Temporary Aid to Needy Families) that are automatically in place - help to decrease fluctuations in the GDP.






36. 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.






37. The difference between the price received by the seller and the seller's reservation price

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






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






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






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






42. 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.






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






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






45. When the rate of inflation is extremely high.






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






47. The labor sector highlights the rate of ____ .






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






49. The monetary sector focuses on the ________ rate.






50. A result of there only being one buyer of a resource input - good - or service.