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






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






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






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






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






6. 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






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






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






9. 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.






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






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






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






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






14. Unicorporated entity that has shared ownership.






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






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






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






18. 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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19. When inflation suddenly deviates from its normal course.






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






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






22. 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.






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






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






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






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






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






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






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






30. Real Estate - Equipment - and Cash (physical assets)






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






32. The monetary sector focuses on the ________ rate.






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






34. When an economic unit makes more than it spends






35. 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.






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






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






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






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






40. The total planned spending on final goods and services.






41. 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.






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






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






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






45. Money multiplied by velocity equals nominal GDP.






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






47. A large - unexpected change in the cost of resources.






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






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






50. A policy that affects potential output