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






2. 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






3. When the rate of inflation is extremely high.






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






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






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






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






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






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






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






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






12. A policy that affects potential output






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






15. 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.






16. That efficiency leads to economic prosperity for all.






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






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






19. Total supply of goods and services in an economy






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






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






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






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






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






26. 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.






27. The time period between a policy's implementation and its desired effects on an economy.






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






29. 1 percent more unemployment results in 2 percent less output.

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30. 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






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






32. Extreme economic growth






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






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






35. 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.






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






37. The real cost of changing a listed price.






38. 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.






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






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






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






42. The goods and services sector focuses largely on the level of ______ .






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






44. Unicorporated entity that has shared ownership.






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






46. Money multiplied by velocity equals nominal GDP.






47. 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.






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






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






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