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






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






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






4. The amount of workers that are willing to work for a real wage.






5. When people's expectations of future inflation do not change even though inflation rates change.






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






7. 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.






8. Extreme economic growth






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






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






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






12. 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.






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






14. Organizations that act as moderators between employers and employees






15. 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.






16. Describes how the economy directly effects the actions policymakers take.






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






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






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






20. Payments that the government makes to unemployed workers.






21. Money multiplied by velocity equals nominal GDP.






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






23. The amount spent by a household on goods and services such as: entertainment - food - and other perishables.






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






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






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






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






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






29. When goods and services are made and consumed at the best levels for the society. Nothing more can be acheived with the resources available.






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






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






32. The monetary sector focuses on the ________ rate.






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






34. The output per employed worker






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






36. The rise in taxes that occurs when before-tax income increases by one dollar






37. The level of output where output equals planned aggregate expenditure






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






39. The value of all goods and services produced anywhere in the world by a nation's citizens during a specified amount of time.






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






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






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






43. 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.






44. If the Federal Reserve lowers the reserve ratio - it ______ the bank's required reserves and ______ the quantity of money.






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






46. 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.






47. 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).






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






49. 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.






50. 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