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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 government office that is responsible for projecting federal surpluses and deficits






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






3. A quantity that is measured in real terms - the actual quantity of a good or service






4. 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.






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






6. A macroeconomic policy that directly affects the structure and various institutions of an economy






7. A free market system that relies on private property ownership and supply and demand






8. 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






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






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






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






12. Used to demonstrate shifts in income distribution among a population over time.






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






14. 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.






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






16. The real cost of changing a listed price.






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






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






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






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






23. The movement of workers between jobs - companies - and industries






24. 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.






25. The increase in total benefit that comes from producing one additional unit.






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






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






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






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






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






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






32. Payments that the government makes to unemployed workers.






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






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






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






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






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






38. A result of there only being one buyer of a resource input - good - or service.






39. Organizations that act as moderators between employers and employees






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






41. The labor sector highlights the rate of ____ .






42. Money multiplied by velocity equals nominal GDP.






43. The difference between the price received by the seller and the seller's reservation price

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44. 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.






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






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






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






48. A policy that affects potential output






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






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