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Test your basic knowledge |
CLEP Macroeconomics - 3
Start Test
Study First
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 beginning of a recession
Peak
Outside lag
Complement
Labor productivity
2. The real cost of changing a listed price.
Intangible Assets
Real employment
Menu cost
Free market
3. 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.
Rationing
Indexing
Contractionary policies
Keynesian economic theory
4. When people's expectations of future inflation do not change even though inflation rates change.
Inside lag
Business cycle
Labor productivity
Anchored inflation expectations
5. The increase in total benefit that comes from producing one additional unit.
Rationing
Marginal benefit
Intermediate Goods
Capital goods
6. Goods that are used in the production of final goods.
Supply-side policy
Intermediate goods
Policy reaction function
Aggregate demand
7. 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.
Structural policy
Sunk cost
The real GDP per person
Traditional economic system
8. The adding up of individual economic variables to obtain a large - general picture of the economy.
Equilibrium price
Aggregation
Laffer curve
Capitalism
9. Can be found by multiplying the average labor productivity by the percentage of people that are working in the economy.
The real GDP per person
Market equilibrium
Capital income
Outside lag
10. Describes how the economy directly effects the actions policymakers take.
Aggregate demand
Nominal GDP
Inside lag
Policy reaction function
11. Concerned with analyzing whether or not a policy should be used.
Marginal tax rate
Keynesian model
Normative analysis
Seller's reservation price
12. A cost that is beyond recovery the moment a consumer decides to purchase a certain good or service is made
Sunk cost
Intermediate Goods
Adam Smith
Relative price
13. Goods like food and clothing that have a short lifespan.
Anchored inflation expectations
Law of Demand
Consumer Nondurables
Consumption
14. 1 percent more unemployment results in 2 percent less output.
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15. The annual percentage rate of change in price level reflected by price indexes
The rate of inflation
Nominal GDP
Credibility of monetary policy
Adam Smith
16. The output per employed worker
Labor productivity
Partnership
Automatic stabilizers
Four sectors of the economy
17. When goods and services are made and consumed at the best levels for the society. Nothing more can be acheived with the resources available.
Tangible Assets
Economic efficiency
Capitalism
Anchored inflation expectations
18. The international sector emphasizes the ________ rate.
Exchange
Excess Supply
Saving
Price
19. Economic rule stating that if two items satisfy the same need and the price of one rises - people will buy the other.
Labor productivity
Marginal tax rate
Policy reaction function
Substitution effect
20. The part of economics study that looks at the operation of a nation's economy as a whole
Inflation
Unemployment insurance
Partnership
Macroeconomics
21. The quantity of a good that results in the maximum possible economic surplus from producing and consuming the good.
Complement
Worker mobility
Socially optimal quantity
Velocity
22. Represents the governmental tax rate that will best maximize tax revenues.
Price level
Laffer curve
Capital income
Macroeconomics
23. Used to demonstrate shifts in income distribution among a population over time.
Liquidity
Phillips curve
The principle of efficiency
Lorenz curve
24. When the people believe that the nation's central bank will keep inflation rates low.
Credibility of monetary policy
Planned aggregate expenditure (PAE)
Keynesian model
NRU
25. A phrase coined by Adam Smith to describe the process that turns self directed gain into social and economic benefits for all.
Pay
Invisible hand
Inside lag
Marginal tax rate
26. 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.
Stabilization policies
Consumption
Automatic stabilizers
Economic efficiency
27. When economists fail to account for improvements in goods or services and incorrectly report inflation as higher.
Liquidity
Core rate of inflation
The quality adjustment bias
Invisible hand
28. The opposite of a substitute good - because it usually completes another item and may lead to more consumption of that item.
Income
Saving
LRAS
Complement
29. A macroeconomic policy that directly affects the structure and various institutions of an economy
Inside lag
Structural policy
Credibility of monetary policy
Frictional unemployment
30. The rate of price increase on all things except food and energy
Aggregate Supply
Fractional
Core rate of inflation
Indexing
31. 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.
Equilibrium price
Gross National Product (GNP)
Interest
Participation rate
32. A market with unrestricted trading of goods - where the prices of goods are determined by supply and demand.
Aggregation
Free market
Nominal GDP
Price level
33. Distributing a good or resource among consumers that would like to have more of that good or resource than is made available
Substitution bias
Gross National Product (GNP)
NRU
Rationing
34. 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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35. The value of all goods and services produced anywhere in the world by a nation's citizens during a specified amount of time.
Menu cost
Gross National Product (GNP)
Socially optimal quantity
Substitution bias
36. The level of output where output equals planned aggregate expenditure
Sunk cost
Capital income
Short run equilibrium output
The real GDP per person
37. The time between the need for a macroeconomic policy and its implementation
Socially optimal quantity
Inside lag
Interest
Boom
38. The percentage of working-age people within the labor force
Command economic system
Income
Participation rate
Asset
39. Money multiplied by velocity equals nominal GDP.
Quantity equation
Traditional economic system
decreases increases
Marginal benefit
40. If the Federal Reserve lowers the reserve ratio - it ______ the bank's required reserves and ______ the quantity of money.
decreases increases
Rationing
Complement
Gross National Product (GNP)
41. Used in the production of final goods - but instead of being consumed - are available for reuse.
Market equilibrium
Credibility of monetary policy
Capital goods
Law of Demand
42. 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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43. A quantity that is measured in real terms - the actual quantity of a good or service
Laffer curve
decreases increases
Real quantity
Marginal benefit
44. Maximum price that a customer is willing to pay for a good
Aggregate Supply
Peak
Structural policy
Reservation price
45. The total demand for a country's output. It includes demands for consumption - investment - government purchases - and net exports.
Asset
Aggregate demand
Credibility of monetary policy
Adam Smith
46. Long Run Aggregate Supply - The natural level of GDP - shown vertical on a graph. When LRAS shifts - SRAS (Short Run Aggregate Supply) will follow .
Disinflation
LRAS
Sole proprietorship
Monopsony
47. The labor sector highlights the rate of ____ .
Pay
Congressional budget office
Mixed market
Partnership
48. When both producers and consumers are satisfied with their quantities at market price.
Potential output
Market equilibrium
Real quantity
Inflation inertia
49. 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
Intangible Assets
Tangible Assets
Worker mobility
50. 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.
Corporation
Relative price
Contractionary policies
Command economic system