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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. (n) something of value; a resource; an advantage






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






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






5. 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.






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






7. A measure of overall price levels at a specific point in the price index.






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






9. Caused by changes in the overall economy.






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






11. The percentage of working-age people within the labor force






12. Unicorporated entity that has shared ownership.






13. Maximum price that a customer is willing to pay for a good






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






15. The beginning of a recession






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






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






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






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






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






21. 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.






22. The international sector emphasizes the ________ rate.






23. 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






24. Represents the governmental tax rate that will best maximize tax revenues.






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






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






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






28. When inflation suddenly deviates from its normal course.






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






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






31. Payments that the government makes to unemployed workers.






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






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






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






36. 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.






37. The economic theory that states the main cause of change in aggregate output and price level is the result of monetary supply and the interest rate that comes from the amount of monetary supply






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






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






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






41. Extreme economic growth






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






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. That efficiency leads to economic prosperity for all.






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






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






47. Caused by changes in demand or technology. Long-term and continual unemployment that continues even though the economy is producing normally






48. 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.






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






50. Total supply of goods and services in an economy