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Test your basic knowledge |
CLEP Macroeconomics - 3
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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 amount of workers that are willing to work for a real wage.
Velocity
Consumer Nondurables
Labor supply
Fisher effect
2. 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.
Command economic system
NRU
Liquidity
Supply-side policy
3. Natural Rate of Unemployment - a rate that will always exist
Partnership
NRU
Peak
Excess Supply
4. When people's expectations of future inflation do not change even though inflation rates change.
Capital income
Laffer curve
Anchored inflation expectations
Expansionary policies
5. 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.
Inflation shock
Contractionary policies
Hyperinflation
NRU
6. The quantity of a good that results in the maximum possible economic surplus from producing and consuming the good.
Saving
Socially optimal quantity
Mixed market
Command economic system
7. The part of economics study that looks at the operation of a nation's economy as a whole
Participation rate
Keynesian economic theory
Macroeconomics
Automatic stabilizers
8. Organizations that act as moderators between employers and employees
Labor unions
AD curve intersects the SAS curve
Seller's reservation price
Keynesian model
9. The total planned spending on final goods and services.
Businesses
Planned aggregate expenditure (PAE)
Real employment
Macroeconomics
10. The real cost of changing a listed price.
Buyer's surplus
Fisher effect
Menu cost
Saving
11. The price of a good or service in relation to the price of other goods and services.
Liquidity
Worker mobility
Relative price
The Wealth Effect
12. When inflation suddenly deviates from its normal course.
Short run equilibrium output
Inflation shock
Macroeconomics
Intermediate goods
13. 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.
Equilibrium price
Law of Demand
Normative analysis
Law of Diminishing Marginal Utility
14. An extreme decline in the rate of inflation. Can lead to high levels of unemployment and recessionary gaps.
Real quantity
Average tax rate
Disinflation
Contractionary policies
15. Unicorporated entity that has shared ownership.
The quality adjustment bias
Partnership
Structural policy
Policy reaction function
16. 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
Monopsony
Real employment
Contractionary policies
Real GDP
17. On a demand curve - the _____ of the item is placed on the vertical axis of the graph.
Price
Socially optimal quantity
The Wealth Effect
Cyclical unemployment
18. 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.
The Wealth Effect
Consumption
Aggregate demand
Traditional economic system
19. Caused by changes in demand or technology. Long-term and continual unemployment that continues even though the economy is producing normally
Structural unemployment
Market equilibrium
Seller's surplus
Anchored inflation expectations
20. The total value of goods and services produced in a country valued at current prices.
Worker mobility
Nominal GDP
Structural unemployment
Law of Supply
21. The percentage of working-age people within the labor force
Unemployment insurance
Worker mobility
Congressional budget office
Participation rate
22. Can be found by multiplying the average labor productivity by the percentage of people that are working in the economy.
Gross Domestic Product (GDP)
Deflation
Sole proprietorship
The real GDP per person
23. If the Federal Reserve lowers the reserve ratio - it ______ the bank's required reserves and ______ the quantity of money.
Invisible hand
decreases increases
Equilibrium price
Marginal cost
24. Includes payment to the owners of tangible and intangible capital items such as: factories - machines - and copyrights.
Liquidity
Capital income
Reservation price
Disinflation
25. Concerned with analyzing whether or not a policy should be used.
Mixed market
Inside lag
Normative analysis
Consumption function
26. Government policies aimed at stabilizing the economy by eliminating output gaps
Stabilization policies
Rationing
Capital goods
Monopsony
27. The amount spent by a household on goods and services such as: entertainment - food - and other perishables.
Market equilibrium
Free market
Consumption
Monetarism
28. 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.
Seller's surplus
Real employment
Labor productivity
Gross National Product (GNP)
29. The maximum amount that an economy can output over a period of time
Frictional unemployment
Potential output
Marginal benefit
Standard of living
30. A Scottish man (1723-1790) who is known as the father of modern economics.
Capital goods
Adam Smith
Outside lag
Disinflation
31. Total supply of goods and services in an economy
Rationing
Nominal GDP
Aggregate supply
LRAS
32. The time period between a policy's implementation and its desired effects on an economy.
Outside lag
Nominal GDP
Average tax rate
Core rate of inflation
33. The ease with which an asset can be converted to currency.
Inflationary gap
Sunk cost
Liquidity
Marginal tax rate
34. An increase in this would cause an increase in the aggregate supply
Labor productivity
Traditional economic system
The principle of efficiency
Aggregate supply
35. Economies based on capitalism have microeconomic instability and that government is required to properly stabilize the economy.
Keynesian economic theory
Intermediate goods
Contractionary policies
Four sectors of the economy
36. The goods and services sector focuses largely on the level of ______ .
Labor unions
Invisible hand
Relative price
Income
37. A macroeconomic policy that directly affects the structure and various institutions of an economy
AD curve intersects the SAS curve
Structural policy
Intangible Assets
Inflation shock
38. A phrase coined by Adam Smith to describe the process that turns self directed gain into social and economic benefits for all.
AD curve intersects the SAS curve
Invisible hand
Aggregation
Saving
39. Goods not counted in the nation's GDP.
Asset
Phillips curve
Intermediate Goods
Planned aggregate expenditure (PAE)
40. Goods and services sector - Labor sector - monetary sector - international sector.
Nominal GDP
Four sectors of the economy
Capitalism
Indexing
41. Business entity which legally has no separate existence from its owner.
Frictional unemployment
Consumption function
Boom
Sole proprietorship
42. Patents - Goodwill - and Trademarks (lack physical substance)
Intangible Assets
Tangible Assets
Adam Smith
The quality adjustment bias
43. When the people believe that the nation's central bank will keep inflation rates low.
Credibility of monetary policy
Consumer Nondurables
Peak
Deflation
44. Money multiplied by velocity equals nominal GDP.
Sole proprietorship
decreases increases
Quantity equation
Aggregate supply shock
45. (n) something of value; a resource; an advantage
Rationing
Asset
Interest
Sunk cost
46. Payments that the government makes to unemployed workers.
Inside lag
Autonomous Expenditure
Unemployment insurance
Boom
47. The beginning of a recession
Peak
Participation rate
Worker mobility
Adam Smith
48. 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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49. The annual percentage rate of change in price level reflected by price indexes
Corporation
The rate of inflation
Substitution effect
Trough
50. The adding up of individual economic variables to obtain a large - general picture of the economy.
Buyer's surplus
Aggregation
Capitalism
Indexing