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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. Business entity which legally has no separate existence from its owner.
Sole proprietorship
Deflation
Normative analysis
Laffer curve
2. The continuing increase in the average level of prices of goods and services over time.
Seller's reservation price
Inflation
Structural unemployment
Fractional
3. Involves increasing a nominal quantity so that it remains unaffected by increases in inflation
Socially optimal quantity
Indexing
Seller's surplus
Partnership
4. Includes payment to the owners of tangible and intangible capital items such as: factories - machines - and copyrights.
Seller's reservation price
Business cycle
Potential output
Capital income
5. Goods not counted in the nation's GDP.
Anchored inflation expectations
Intermediate Goods
Inflation
Traditional economic system
6. 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
Businesses
Substitution bias
Real quantity
Total surplus
7. The relationship between disposable income and spending on consumable goods and services
Labor productivity
Law of Diminishing Marginal Utility
Consumption function
Inflation shock
8. A phrase coined by Adam Smith to describe the process that turns self directed gain into social and economic benefits for all.
Intangible Assets
Mixed market
Marginal cost
Invisible hand
9. 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.
Anchored inflation expectations
Mixed market
Monopsony
Command economic system
10. A market with unrestricted trading of goods - where the prices of goods are determined by supply and demand.
Sole proprietorship
Nominal GDP
Free market
Lorenz curve
11. Most free-market banking systems are based on __________ reserves.
LRAS
Capitalism
Fractional
Autonomous Expenditure
12. Patents - Goodwill - and Trademarks (lack physical substance)
Intangible Assets
Corporation
Fisher effect
Peak
13. When both producers and consumers are satisfied with their quantities at market price.
Disinflation
Market equilibrium
Intermediate goods
Average tax rate
14. Unicorporated entity that has shared ownership.
Fractional
Partnership
Normative analysis
Labor unions
15. The tendency for nominal interest rates to be high when inflation rates are high and low when inflation rates are low.
Fisher effect
Menu cost
Mixed market
Real employment
16. (n) something of value; a resource; an advantage
Labor productivity
Asset
Frictional unemployment
Economic efficiency
17. When goods and services are made and consumed at the best levels for the society. Nothing more can be acheived with the resources available.
Income
Economic efficiency
Real quantity
Cyclical unemployment
18. 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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19. When inflation suddenly deviates from its normal course.
Inflation shock
Total surplus
Tangible Assets
Intermediate goods
20. The government office that is responsible for projecting federal surpluses and deficits
Economic efficiency
Businesses
The rate of inflation
Congressional budget office
21. The speed that money changes hands in order to buy and sell final goods and services.
Corporation
Labor productivity
Average tax rate
Velocity
22. 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.
Inflation shock
Automatic stabilizers
Structural unemployment
Intermediate Goods
23. The ease with which an asset can be converted to currency.
Recession
Liquidity
Invisible hand
Partnership
24. Describes how the economy directly effects the actions policymakers take.
Total surplus
Labor unions
Adam Smith
Policy reaction function
25. Concerned with analyzing whether or not a policy should be used.
Normative analysis
Keynesian economic theory
Quantity equation
Autonomous Expenditure
26. Distributing a good or resource among consumers that would like to have more of that good or resource than is made available
Pay
Marginal benefit
Rationing
The Wealth Effect
27. The level of output where output equals planned aggregate expenditure
Intermediate goods
Hyperinflation
Short run equilibrium output
Marginal cost
28. Measures the ability of an economy to produce (output) goods and services in the short-term and the long-term.
Aggregate Supply
Substitution bias
Reservation price
NRU
29. A measure of overall price levels at a specific point in the price index.
Macroeconomics
Price level
Interest
Aggregate Supply
30. Real Estate - Equipment - and Cash (physical assets)
Core rate of inflation
Tangible Assets
Market equilibrium
Fractional
31. The price of a good or service in relation to the price of other goods and services.
Intermediate goods
Relative price
Aggregate supply
Autonomous Expenditure
32. The monetary sector focuses on the ________ rate.
Macroeconomics
Equilibrium price
Interest
Potential output
33. Goods and services sector - Labor sector - monetary sector - international sector.
Inflation
Aggregate supply shock
Relative price
Four sectors of the economy
34. When an economic unit makes more than it spends
Price
Macroeconomics
Pay
Saving
35. In a traditional economic system - the availability of resources is based on inheritance. Goods are only produced for consumption and surpluses do not occur. This type of economy is normally found in South American - Asian - and African countries.
Velocity
Substitution bias
Traditional economic system
Capital income
36. When economists fail to account for improvements in goods or services and incorrectly report inflation as higher.
Automatic stabilizers
The quality adjustment bias
Traditional economic system
Corporation
37. Government policies aimed at stabilizing the economy by eliminating output gaps
Reservation price
Relative price
Boom
Stabilization policies
38. The adding up of individual economic variables to obtain a large - general picture of the economy.
Outside lag
LRAS
Okun's Law
Aggregation
39. When quantity supplied is more than quantity demanded. The formula for excess supply is: Supply - Demand = Excess Supply
Planned aggregate expenditure (PAE)
Structural unemployment
Excess Supply
Inflation inertia
40. The total planned spending on final goods and services.
Sunk cost
Planned aggregate expenditure (PAE)
Income
Deflation
41. 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.
Frictional unemployment
Nominal GDP
Real employment
Monopsony
42. The amount spent by a household on goods and services such as: entertainment - food - and other perishables.
Labor productivity
Fractional
Consumption
Intermediate Goods
43. Short-run macroeconomic equilibrium occurs at the level of GDP where the:
NRU
The principle of efficiency
Macroeconomics
AD curve intersects the SAS curve
44. Total tax paid divided by total (taxable) income - as a percentage.
Average tax rate
Stabilization policies
Sole proprietorship
Total surplus
45. Money multiplied by velocity equals nominal GDP.
Equilibrium price
Quantity equation
Monetarism
Labor unions
46. When people's expectations of future inflation do not change even though inflation rates change.
Anchored inflation expectations
Inflation inertia
Fractional
Indexing
47. A large - unexpected change in the cost of resources.
Aggregate supply shock
Inflation
Seller's surplus
Mixed market
48. The quantity of a good that results in the maximum possible economic surplus from producing and consuming the good.
Socially optimal quantity
Marginal cost
Inflation shock
Complement
49. The degree to which people have access to goods and services that make their lives better.
decreases increases
Standard of living
Policy reaction function
Frictional unemployment
50. A policy that affects potential output
Unemployment insurance
Contractionary policies
Potential output
Supply-side policy