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Test your basic knowledge |
CLEP Macroeconomics: Measurement Of Economic Performance - 2
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. Real GDP - net taxes
political process
disposable income
Keynesian theory's criticism
left
2. The amount by which a change in aggregate expenditure is multiplied to determine the change in equilibrium expenditure and real GDP
do not
cyclical deficit
crowding out effect
multiplier
3. Made up of autonomous expenditure and induced expenditure
do not
aggregate expenditure
investment
exports
4. Slope of savings function is equal to...
MPS
Ricardian Equivalence Theorum
do not
exports
5. The part of aggregate planned expenditure that does change when real GDP changes
wages
induced expenditure
recession
do not
6. The level of aggregate expenditure when aggregate planned expenditure equals real GDP
consumption expenditure
disposable income
equilibrium expenditure
crowding out effect
7. Demand side effects are large; supply side - small
2.86
autonomous expenditure
traditional view of fiscal policy
increases
8. Savings in circular flow diagram is...
output
Ricardian Equivalence Theorum
Keynesian model
leakage
9. A deficit that arises out of a recession
multiplier
crowding out effect
cyclical deficit
leakage
10. Inventories remain at their target levels when....
crowding out effect
at equilibrium expenditure
structural deficit
MPC out of real GDP
11. According to classical theory - an increase in AD increases the price level but not the level of...
output
at equilibrium expenditure
inflation
recession
12. A deficit that persists during full employment
equilibrium expenditure
left
structural deficit
expansionary fiscal policy
13. Goods or services produced in a given nation and sold to customers in other nations
automatic stabilizers
exports
Keynesian theory's criticism
equilibrium expenditure
14. While investment - government spending - and exports remain constant during changes in the GDP - this kind of expenditure changes with the level of GDP
MPC x (1 - the marginal tax rate)
output
consumption expenditure
aggregate demand
15. A decrease in government expenditures or an increase in taxes
contractionary fiscal policy
induced expenditure
Ricardian Equivalence Theorum
inverse relationship
16. The average tax rate rises with GDP
consumption expenditure
crowding out effect
traditional view of fiscal policy
progressive tax system
17. Lists the level of aggregate planned expenditure at each level of real GDP
aggregate expenditure schedule
consumption expenditure
contractionary fiscal policy
equation to determine a multiplier
18. Changes in real GDP DO or DO NOT change domestic exports.
recession
Ricardian Equivalence Theorum
induced expenditure
do not
19. A change in equilibrium expenditure divided by a change in aggregate expenditure
fiscal policy
traditional view of fiscal policy
Say's Law
equation to determine a multiplier
20. An increase in public debt will have little or no effect on real output or employment because people will choose to save more money
multiplier
increases
investment
Ricardian Equivalence Theorum
21. The magnitude of the multiplier depends on the ___ _____
do not
2.86
AE curve
less
22. (1) Pure competition; (2) Flexible wages and prices; (3) Self-interested motives; (4) People cannot be fooled by money illusions
do not
investment
recession
4 assumptions of Classical Model
23. The part of aggregate planned expenditure that does not change when real GDP changes
inflation
autonomous expenditure
MPS
traditional view of fiscal policy
24. The time of production during which there are only essentially variable costs
short-run
2.86
output
long-run
25. The time of production during which there are fixed and variable costs
less
short-run
consumption expenditure
crowding out effect
26. Appropriate changes in government expenditures that occur naturally
Say's Law
inflation
automatic stabilizers
left
27. Opposite of traditional view; supply side effects are dominant
increases
supply-side
recession
MPS
28. A capitalist economy does not tend to employ its resources fully
29. According to classical theory - demand for this creates unemployment
political process
consumption expenditure
wages
recession
30. An increase in real GDP _________ imports
output
increases
recession
4 assumptions of Classical Model
31. C + I + G + N - import function
Say's Law
wages
supply-side
aggregate expenditure curve
32. According to Keynesian theory - this is horizontal
aggregate expenditure
SRAS curve
less
crowding out effect
33. Changes in real GDP DO or DO NOT change investment plans.
do not
MPC x (1 - the marginal tax rate)
supply-side
AE curve
34. Contractionary fiscal policy would be used to counteract _________
cyclical deficit
inflation
supply-side
traditional view of fiscal policy
35. The capitalistic economy would tend to employ its resources fully
Classical Theory of Employment
wages
international prices - international trade agreements - and real GDP in the rest of the world
aggregate expenditure curve
36. What changes government expenditure
short-run
aggregate demand
automatic stabilizers
political process
37. Two factors that influence or change investment plans
long-run
expected rate of profit and real interest rate
equilibrium expenditure
progressive tax system
38. As real GDP increases - disposable income increases - but by ___ than the increase in real GDP because net taxes also increase.
less
LRAS curve
crowding out effect
expected rate of profit and real interest rate
39. Fiscal Policy changes that increase or decrease equilibrium expenditure will increase or decrease _________ ________.
aggregate expenditure curve
MPS
aggregate demand
Say's Law
40. If the MPC is 0.65 - what is the multiplier?
leakage
imports
2.86
Keynesian theory's criticism
41. Claims that expansionary fiscal policy will increase interest rates and reduce investment
short-run
SRAS curve
imports
crowding out effect
42. Most economic theory is based on this
aggregate expenditure curve
equilibrium expenditure
contractionary fiscal policy
Keynesian model
43. Sizes of MPS and multiplier
Ricardian Equivalence Theorum
traditional view of fiscal policy
inverse relationship
Keynesian theory's criticism
44. Changes in real GDP DO or DO NOT change government expenditure.
less
2.86
crowding out effect
do not
45. Change in imports divided by the change in real GDP
traditional view of fiscal policy
less
aggregate expenditure schedule
equation of marginal propensity to import
46. Factors that change domestic imports
expansionary fiscal policy
equation to determine a multiplier
cyclical deficit
international prices - international trade agreements - and real GDP in the rest of the world
47. Dictates rises and falls in consumption expenditure
do not
MPC out of real GDP
2.86
equilibrium expenditure
48. The larger the MPC - the ______ the multiplier
autonomous expenditure
short-run
SRAS curve
larger
49. Spending for the production and accumulation of capital goods and additions to inventory
aggregate expenditure
do not
investment
Classical Theory of Employment
50. Equation for MPC out of real GDP
less
MPC x (1 - the marginal tax rate)
traditional view of fiscal policy
international prices - international trade agreements - and real GDP in the rest of the world