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Test your basic knowledge |
CLEP Macroeconomics - 3
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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. When inflation suddenly deviates from its normal course.
Substitution bias
Labor productivity
Seller's surplus
Inflation shock
2. Payments that the government makes to unemployed workers.
Short run equilibrium output
Gross Domestic Product (GDP)
Unemployment insurance
Capital goods
3. The portion of planned aggregate expenditure that is not based on output
Aggregate Supply
Autonomous Expenditure
Menu cost
Inflation shock
4. 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
Lorenz curve
Substitution bias
Autonomous Expenditure
Pay
5. A Scottish man (1723-1790) who is known as the father of modern economics.
Monopsony
Socially optimal quantity
Adam Smith
Aggregate supply shock
6. Short-run macroeconomic equilibrium occurs at the level of GDP where the:
AD curve intersects the SAS curve
Excess Supply
Interest
Aggregation
7. The relationship between disposable income and spending on consumable goods and services
Inflation shock
Law of Supply
Real quantity
Consumption function
8. The basic assumption of this model is that in the short run - firms meet demand at present price.
Supply-side policy
Market equilibrium
Law of Supply
Keynesian model
9. 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.
Fisher effect
Real quantity
Law of Supply
Stabilization policies
10. When quantity supplied is more than quantity demanded. The formula for excess supply is: Supply - Demand = Excess Supply
Excess Supply
Sole proprietorship
Nominal GDP
Capital income
11. The lowest point of the recession
Intermediate goods
Okun's Law
Trough
Total surplus
12. Can be found by multiplying the average labor productivity by the percentage of people that are working in the economy.
The Wealth Effect
Businesses
Partnership
The real GDP per person
13. When the people believe that the nation's central bank will keep inflation rates low.
Buyer's surplus
Lorenz curve
Credibility of monetary policy
Nominal GDP
14. Goods that are used in the production of final goods.
Tangible Assets
Aggregate supply shock
Fisher effect
Intermediate goods
15. The continuing increase in the average level of prices of goods and services over time.
Phillips curve
Inflation
Marginal cost
Capitalism
16. Concerned with analyzing whether or not a policy should be used.
Substitution effect
Normative analysis
Disinflation
Capital goods
17. Most free-market banking systems are based on __________ reserves.
Marginal cost
The Wealth Effect
Fractional
Capital income
18. Legal entity that has received a charter from a state or federal government.
Substitution effect
Anchored inflation expectations
Corporation
Consumption function
19. A quantity that is measured in real terms - the actual quantity of a good or service
Businesses
Real quantity
Keynesian economic theory
Outside lag
20. When prices fall consistently over time - leading to negative inflation.
Deflation
Disinflation
Monetarism
Keynesian model
21. Extreme economic growth
Inside lag
Laffer curve
Boom
Gross National Product (GNP)
22. That efficiency leads to economic prosperity for all.
Gross Domestic Product (GDP)
The principle of efficiency
Phillips curve
The real GDP per person
23. Organizations that act as moderators between employers and employees
Excess Supply
Labor unions
Anchored inflation expectations
Asset
24. The price of a good or service in relation to the price of other goods and services.
Short run equilibrium output
The rate of inflation
Inside lag
Relative price
25. 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).
Pay
Partnership
Indexing
Frictional unemployment
26. The increase in total cost that comes from producing one additional unit of a specific good or service.
Marginal cost
Sunk cost
Monetarism
Command economic system
27. The time between the need for a macroeconomic policy and its implementation
Adam Smith
Trough
Inside lag
Saving
28. Economies based on capitalism have microeconomic instability and that government is required to properly stabilize the economy.
Socially optimal quantity
Total surplus
Sunk cost
Keynesian economic theory
29. A record of economic increases and decreases over time.
Gross Domestic Product (GDP)
Seller's reservation price
Business cycle
Inflation inertia
30. 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.
Pay
Relative price
Real employment
The Wealth Effect
31. Demonstrates that there is an inverse relationship between inflation and unemployment; as inflation increases - unemployment decreases (and vice versa).
Asset
Phillips curve
Velocity
Consumption
32. The output per employed worker
Average tax rate
Reservation price
Labor productivity
Structural policy
33. Business entity which legally has no separate existence from its owner.
Mixed market
Sole proprietorship
Expansionary policies
Laffer curve
34. A market with unrestricted trading of goods - where the prices of goods are determined by supply and demand.
Anchored inflation expectations
Congressional budget office
Worker mobility
Free market
35. The speed that money changes hands in order to buy and sell final goods and services.
Equilibrium price
Labor unions
Velocity
Excess Supply
36. When economists fail to account for improvements in goods or services and incorrectly report inflation as higher.
Inflationary gap
Cyclical unemployment
The quality adjustment bias
Excess Supply
37. 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.
Law of Demand
Gross National Product (GNP)
Asset
Businesses
38. Total supply of goods and services in an economy
Aggregate supply
Law of Diminishing Marginal Utility
Phillips curve
Structural policy
39. When both producers and consumers are satisfied with their quantities at market price.
Market equilibrium
Gross National Product (GNP)
Sole proprietorship
Recession
40. Money multiplied by velocity equals nominal GDP.
Command economic system
Quantity equation
Relative price
Okun's Law
41. 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
Consumer Nondurables
Real GDP
Pay
Interest
42. The movement of workers between jobs - companies - and industries
Fisher effect
Gross National Product (GNP)
Four sectors of the economy
Worker mobility
43. Natural Rate of Unemployment - a rate that will always exist
Corporation
Capitalism
Traditional economic system
NRU
44. A result of there only being one buyer of a resource input - good - or service.
Aggregate demand
Monopsony
Relative price
Capital goods
45. Long Run Aggregate Supply - The natural level of GDP - shown vertical on a graph. When LRAS shifts - SRAS (Short Run Aggregate Supply) will follow .
Macroeconomics
Standard of living
Cyclical unemployment
LRAS
46. Patents - Goodwill - and Trademarks (lack physical substance)
Tangible Assets
Labor unions
Intangible Assets
Labor productivity
47. Caused by changes in the overall economy.
Cyclical unemployment
The real GDP per person
Reservation price
Liquidity
48. A phrase coined by Adam Smith to describe the process that turns self directed gain into social and economic benefits for all.
Businesses
Intermediate goods
Rationing
Invisible hand
49. Used to demonstrate shifts in income distribution among a population over time.
Lorenz curve
Fractional
AD curve intersects the SAS curve
Real employment
50. An extreme decline in the rate of inflation. Can lead to high levels of unemployment and recessionary gaps.
Rationing
Intermediate Goods
Disinflation
The rate of inflation