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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. When inflation suddenly deviates from its normal course.






2. Payments that the government makes to unemployed workers.






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






4. 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






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






6. Short-run macroeconomic equilibrium occurs at the level of GDP where the:






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






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






9. 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.






10. When quantity supplied is more than quantity demanded. The formula for excess supply is: Supply - Demand = Excess Supply






11. The lowest point of the recession






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






13. When the people believe that the nation's central bank will keep inflation rates low.






14. Goods that are used in the production of final goods.






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






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






17. Most free-market banking systems are based on __________ reserves.






18. Legal entity that has received a charter from a state or federal government.






19. A quantity that is measured in real terms - the actual quantity of a good or service






20. When prices fall consistently over time - leading to negative inflation.






21. Extreme economic growth






22. That efficiency leads to economic prosperity for all.






23. Organizations that act as moderators between employers and employees






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






25. 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).






26. The increase in total cost that comes from producing one additional unit of a specific good or service.






27. The time between the need for a macroeconomic policy and its implementation






28. Economies based on capitalism have microeconomic instability and that government is required to properly stabilize the economy.






29. A record of economic increases and decreases over time.






30. 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.






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






32. The output per employed worker






33. Business entity which legally has no separate existence from its owner.






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






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






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






37. 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.






38. Total supply of goods and services in an economy






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






40. Money multiplied by velocity equals nominal GDP.






41. 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






42. The movement of workers between jobs - companies - and industries






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






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






45. Long Run Aggregate Supply - The natural level of GDP - shown vertical on a graph. When LRAS shifts - SRAS (Short Run Aggregate Supply) will follow .






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






47. Caused by changes in the overall economy.






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






49. Used to demonstrate shifts in income distribution among a population over time.






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