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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 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.






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






3. The maximum amount that an economy can output over a period of time






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






5. The monetary sector focuses on the ________ rate.






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






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






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






9. The opposite of a substitute good - because it usually completes another item and may lead to more consumption of that item.






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






11. 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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12. The movement of workers between jobs - companies - and industries






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






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






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






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






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






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






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






20. A difference between the potential output (potential GDP) of an economy and its actual output (actual GDP)






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






22. When the rate of inflation is extremely high.






23. 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.






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






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






26. The price at which the number of products that businesses are willing to supply equals the amount of products that consumers are willing to buy at a specific point in time.






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






28. Sole proprietorships - partnerships - and corporations are private producing units of the economy knows as __________.






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






30. A policy that affects potential output






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






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






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






34. 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






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






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






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






38. When inflation suddenly deviates from its normal course.






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






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






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






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






43. Organizations that act as moderators between employers and employees






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






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






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






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






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






49. Total supply of goods and services in an economy






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