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






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






3. An increase in spending due to a perceived increase in wealth.






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






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






6. The adding up of individual economic variables to obtain a large - general picture of the economy.






7. Measures the ability of an economy to produce (output) goods and services in the short-term and the long-term.






8. That efficiency leads to economic prosperity for all.






9. Money multiplied by velocity equals nominal GDP.






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






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






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






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






14. The monetary sector focuses on the ________ rate.






15. The quantity of a good that results in the maximum possible economic surplus from producing and consuming the good.






16. The total value of goods and services produced in a country valued at current prices.






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






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






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






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






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






22. When inflation suddenly deviates from its normal course.






23. 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.






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






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






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






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






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






30. The goods and services sector focuses largely on the level of ______ .






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






32. 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.






33. 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






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

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






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






37. Involves increasing a nominal quantity so that it remains unaffected by increases in inflation






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






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






40. 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






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






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






44. Total supply of goods and services in an economy






45. 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.






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






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






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






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






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