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Test your basic knowledge |
CLEP Macroeconomics - 3
Start Test
Study First
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. There is an ___________ ___ when aggregate output is above potential output
Asset
Inflationary gap
Labor supply
Quantity equation
2. 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.
Buyer's surplus
Interest
Law of Diminishing Marginal Utility
Labor supply
3. Government policies intended to increase spending and output.
Cyclical unemployment
Expansionary policies
Saving
Equilibrium price
4. The tendency for nominal interest rates to be high when inflation rates are high and low when inflation rates are low.
Fisher effect
Congressional budget office
Sole proprietorship
Rationing
5. 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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6. 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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7. Demonstrates that there is an inverse relationship between inflation and unemployment; as inflation increases - unemployment decreases (and vice versa).
Tangible Assets
Fractional
Phillips curve
Substitution bias
8. The relationship between disposable income and spending on consumable goods and services
Intermediate Goods
Consumption function
Lorenz curve
Output gap
9. 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).
Frictional unemployment
Capital income
Traditional economic system
Menu cost
10. The basic assumption of this model is that in the short run - firms meet demand at present price.
Fisher effect
Exchange
Keynesian model
Planned aggregate expenditure (PAE)
11. 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.
Real GDP
Gross Domestic Product (GDP)
Law of Supply
Inflation
12. 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.
Total surplus
Invisible hand
Law of Demand
Supply-side policy
13. A macroeconomic policy that directly affects the structure and various institutions of an economy
Nominal GDP
Structural policy
Inflationary gap
Consumer Nondurables
14. Concerned with analyzing whether or not a policy should be used.
Sunk cost
Price level
Normative analysis
Capital income
15. A Scottish man (1723-1790) who is known as the father of modern economics.
Aggregate supply
Price
Adam Smith
Structural unemployment
16. 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
Adam Smith
Asset
Substitution bias
Standard of living
17. Patents - Goodwill - and Trademarks (lack physical substance)
Intangible Assets
Laffer curve
Congressional budget office
Capital income
18. The ease with which an asset can be converted to currency.
Excess Supply
Aggregate supply shock
Planned aggregate expenditure (PAE)
Liquidity
19. Goods like food and clothing that have a short lifespan.
Macroeconomics
Expansionary policies
Core rate of inflation
Consumer Nondurables
20. Goods and services sector - Labor sector - monetary sector - international sector.
Four sectors of the economy
decreases increases
Sole proprietorship
Traditional economic system
21. Money multiplied by velocity equals nominal GDP.
Quantity equation
Gross National Product (GNP)
Normative analysis
Fisher effect
22. Total tax paid divided by total (taxable) income - as a percentage.
Average tax rate
Capitalism
Lorenz curve
Consumption function
23. The opposite of a substitute good - because it usually completes another item and may lead to more consumption of that item.
Complement
The rate of inflation
Aggregate supply shock
Market equilibrium
24. The percentage of working-age people within the labor force
The quality adjustment bias
Peak
Participation rate
The Wealth Effect
25. Sole proprietorships - partnerships - and corporations are private producing units of the economy knows as __________.
Law of Demand
Congressional budget office
Potential output
Businesses
26. A GDP decline that lasts two-quarters (six months). A period of slow economic growth
Fisher effect
Mixed market
Recession
Nominal GDP
27. The difference between the buyer's reservation price and the seller's reservation price. Consumer surplus + Producer surplus
Capitalism
Total surplus
Aggregate Supply
Exchange
28. When an economic unit makes more than it spends
LRAS
Market equilibrium
Saving
Law of Supply
29. When both producers and consumers are satisfied with their quantities at market price.
Potential output
Market equilibrium
Four sectors of the economy
Structural policy
30. An increase in this would cause an increase in the aggregate supply
Core rate of inflation
Capital income
Labor productivity
NRU
31. Unicorporated entity that has shared ownership.
Partnership
Aggregate supply
AD curve intersects the SAS curve
The real GDP per person
32. Can be found by multiplying the average labor productivity by the percentage of people that are working in the economy.
Stabilization policies
The real GDP per person
Economic efficiency
Law of Demand
33. Used in the production of final goods - but instead of being consumed - are available for reuse.
Adam Smith
Capital goods
Inside lag
Hyperinflation
34. Caused by changes in the overall economy.
Consumer Nondurables
Total surplus
Macroeconomics
Cyclical unemployment
35. 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.
Excess Supply
Mixed market
Automatic stabilizers
Corporation
36. 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.
Contractionary policies
Excess Supply
Consumer Nondurables
Saving
37. The difference between the price received by the seller and the seller's reservation price
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38. Government policies aimed at stabilizing the economy by eliminating output gaps
Stabilization policies
Autonomous Expenditure
Contractionary policies
Structural policy
39. The part of economics study that looks at the operation of a nation's economy as a whole
Hyperinflation
Macroeconomics
Consumption
Gross National Product (GNP)
40. The annual percentage rate of change in price level reflected by price indexes
Deflation
Labor supply
Saving
The rate of inflation
41. A market with unrestricted trading of goods - where the prices of goods are determined by supply and demand.
Real GDP
Seller's reservation price
Free market
Labor unions
42. 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.
Supply-side policy
Consumption function
Command economic system
Intermediate Goods
43. Maximum price that a customer is willing to pay for a good
Reservation price
Seller's surplus
Intangible Assets
Automatic stabilizers
44. The maximum amount that an economy can output over a period of time
Rationing
Substitution effect
Potential output
Saving
45. When the rate of inflation is extremely high.
Structural policy
Labor productivity
Hyperinflation
Capital goods
46. The portion of planned aggregate expenditure that is not based on output
Unemployment insurance
Autonomous Expenditure
Exchange
Core rate of inflation
47. The labor sector highlights the rate of ____ .
Pay
Trough
Participation rate
Gross National Product (GNP)
48. On a demand curve - the _____ of the item is placed on the vertical axis of the graph.
Planned aggregate expenditure (PAE)
Labor productivity
Price
Intangible Assets
49. The monetary sector focuses on the ________ rate.
Fisher effect
Quantity equation
Interest
Pay
50. A result of there only being one buyer of a resource input - good - or service.
Monopsony
Velocity
Law of Diminishing Marginal Utility
Inflation