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CLEP Macroeconomics: Measurement Of Economic Performance - 2

Subjects : clep, economics
  • Answer 50 questions in 15 minutes.
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  • Match each statement with the correct term.
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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. According to classical theory - this is vertical

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

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

4. Opposite of traditional view; supply side effects are dominant

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

6. Most economic theory is based on this

7. The average tax rate rises with GDP

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

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

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

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

12. Equation for MPC out of real GDP

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

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

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

16. The larger the MPC - the ______ the multiplier

17. Sizes of MPS and multiplier

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

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

20. According to classical theory - demand for this creates unemployment

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

22. Two factors that influence or change investment plans

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

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

25. Dictates rises and falls in consumption expenditure

26. According to Keynesian theory - this is horizontal

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

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

29. A deficit that persists during full employment

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

31. Real GDP - net taxes

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

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

34. Made up of autonomous expenditure and induced expenditure

35. An increase in government expenditures or a decrease in taxes

36. What changes government expenditure

37. 'Supply creates its own demand.'

38. Savings in circular flow diagram is...

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

40. Appropriate changes in government expenditures that occur naturally

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

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

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

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

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

46. Contractionary fiscal policy would be used to counteract _________

47. A deficit that arises out of a recession

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

49. According to classical theory - an increase in AD increases the price level but not the level of...

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