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CLEP Macroeconomics: Measurement Of Economic Performance - 2

Subjects : clep, economics
  • Answer 50 questions in 15 minutes.
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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. Two factors that influence or change investment plans

2. Dictates rises and falls in consumption expenditure

3. Demand side effects are large; supply side - small

4. A deficit that arises out of a recession

5. The government's attempt to influence the economy by setting and changing taxes - transfer payments - and expenditures on goods and services

6. Made up of autonomous expenditure and induced expenditure

7. According to Keynesian theory - this is horizontal

8. Inventories remain at their target levels when....

9. Lists the level of aggregate planned expenditure at each level of real GDP

10. The part of aggregate planned expenditure that does not change when real GDP changes

11. Savings in circular flow diagram is...

12. Change in imports divided by the change in real GDP

13. The larger the MPC - the ______ the multiplier

14. While investment - government spending - and exports remain constant during changes in the GDP - this kind of expenditure changes with the level of GDP

15. Contractionary fiscal policy would be used to counteract _________

16. The purchase of foreign goods or services

17. Real GDP - net taxes

18. The average tax rate rises with GDP

19. Expansionary fiscal policy would be used to counteract a _________

20. A deficit that persists during full employment

21. The level of aggregate expenditure when aggregate planned expenditure equals real GDP

22. As real GDP increases - disposable income increases - but by ___ than the increase in real GDP because net taxes also increase.

23. According to classical theory - this is vertical

24. Changes in real GDP DO or DO NOT change government expenditure.

25. The time of production during which there are only essentially variable costs

26. Goods or services produced in a given nation and sold to customers in other nations

27. A change in equilibrium expenditure divided by a change in aggregate expenditure

28. Changes in real GDP DO or DO NOT change domestic exports.

29. Sizes of MPS and multiplier

30. Changes in real GDP DO or DO NOT change investment plans.

31. Fiscal Policy changes that increase or decrease equilibrium expenditure will increase or decrease _________ ________.

32. The amount by which a change in aggregate expenditure is multiplied to determine the change in equilibrium expenditure and real GDP

33. The capitalistic economy would tend to employ its resources fully

34. The part of aggregate planned expenditure that does change when real GDP changes

35. A capitalist economy does not tend to employ its resources fully

36. An increase in real GDP _________ imports

37. 'Supply creates its own demand.'

38. (1) Pure competition; (2) Flexible wages and prices; (3) Self-interested motives; (4) People cannot be fooled by money illusions

39. Slope of savings function is equal to...

40. If the MPC is 0.65 - what is the multiplier?

41. The magnitude of the multiplier depends on the ___ _____

42. The time of production during which there are fixed and variable costs

43. When a fiscal expansion occurs at Potential GDP the Short-Run Aggregate Supply curve (SAS) shifts _____.

44. Claims that expansionary fiscal policy will increase interest rates and reduce investment

45. C + I + G + N - import function

46. Appropriate changes in government expenditures that occur naturally

47. A decrease in government expenditures or an increase in taxes

48. An increase in public debt will have little or no effect on real output or employment because people will choose to save more money

49. Most economic theory is based on this

50. Spending for the production and accumulation of capital goods and additions to inventory