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AP Macroeconomics

Subjects : economics, ap
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. Occurs when supply and demand are balanced such that the market price and the quantity exchanged are under no market pressure to change.






2. The dollar value of all the goods and services sold to house holds.






3. Inflation that follows from an increase in aggregate demand - which will cause equilibrium real GDP (Y) to increase and the equilibrium price level (P) to increase.






4. An industry structure in which there is only one seller for a product.






5. The graphical representation of the law of demand. Shows the amount of a good buyers are willing and able to buy at various prices.






6. A special tax imposed on imported goods.






7. The addition to total revenue created by selling one additional unit of ouput.






8. The amount of a good actually sold.






9. The effort of workers.






10. Inflation created when an increase in the costs of production (wages or raw materials) shifts the short-run aggregate supply (AS) curve to the left; tends to push prices up while reducing the level of real GDP at the same time (stagflation).






11. Resource is unavailable in sufficient amounts to satisfy various ways society wants to use it.






12. Enacted when the government deliberately increases its deficit to stimulate the economy; the government increases its spending (increases G) - cuts taxes (decreases T) - or both - and stimulates the economy by expanding aggregate demand (AD).






13. A bad depressingly prolonged recession in economic activity.






14. The dollar value of production within a nation's border.






15. A movement along the demand curve in response to a change in price - ceteris paribus; change in price means move along the demand curve; movement = money.






16. Decisions of individual producers and consumers determine what how and for whom to reduce. Minor Government interference. Economy is run by itself.






17. A country has a trade deficit if the value of its commodity imports exceeds the value of its commodity exports.






18. A specific percentage of checking account deposits that each bank must keep in liquid - zero-interest reserves; this amount is set by the Fed.






19. Economic tool used to determine exactly the amount of the new demand deposits that can be created from an initial deposit.






20. A curve depicting the relationship between real GDP demanded (i.e. - expenditures) and the price level in the economy; the aggregate demand curve slopes downward from left to right.






21. A Latin phrase meaning 'all things constant.'






22. A relationship between two factors in which the factors move in opposite directions. ex: price increases - then quantity decreases.






23. The sum of each individual consumer's demand curves for a certain good in a market (e.g. - all the individual quantities of Good B demanded at each price).






24. When the percent of change in the quantity demanded equals the percent of change in price.






25. A type of inflation that occurs when an economy's output (real GDP decreases and its price level rises; production stagnates (as during a recession) while prices (and unemployment) go up.






26. A market with only a few sellers - each offering a product that is largely the same as the others' products; in an oligopoly - there is always a tension between cooperation and competition.






27. (population); Then there is a shift in the demand curve resulting from and increase or decrease in market demand - as specific consumption related to demographics is concerned.






28. When consumers substitute a similar - lower priced product for a product which is relatively more expensive.






29. The lowest point of a business cycle






30. The income of households after taxes have been paid






31. Can be measured by using TR as a gauge; a decrease in TR following an increase in Price = Elastic Demand - When Price and TR move in opposite directions..... P?/TR? or P?/TR?






32. The efforts of entrepreneurs in organizing resources for production taking risk to create new enterprises and innovating to develop new product.






33. Short-run aggregate supply curve






34. The dollar value of goods and services sold to governments.






35. The sum of all the quantities of a good supplies by all producers at each price.






36. The proportion of each additional dollar of income that is saved.






37. Goods that compete with one another. If the price for one goes up the demand for the other will go up.






38. Long- run aggregate supply curve






39. Graphic representation of an inverse relationship between wage growth (percentage change in price level - such as inflation) and unemployment.






40. Anything that shows the economy as a whole.






41. Unemployment faced by workers who have lost their jobs because of changing market (demand) conditions & whose skills don't match the requirements of available jobs.






42. A law stating that as an additional unit of a particular food is consumed the utility (satisfaction) gained decreases.






43. A good the demand for which rises as income rises and falls as income falls; consumer income rises and demand rises.






44. Results an increase in the demand for normal goods and a decrease in the demand for inferior goods.






45. 1/RRR - where RRR is the required reserve ratio expressed as a decimal; if the required reserve ratio is 10% (0.1) - the money multiplier is 1/0.1 = 10.






46. A curve defining the relationship between real production and price level.






47. An increase or decrease in consumer income will cause a shift in the Demand Curve.






48. Fluctuations in real GDP around the trend value; also called economic fluctuations.






49. Where the demand curve is horizontal - reflecting situation in which any change in price reduces quantity demanded to '0.' the result of a competitive market consumers will go elsewhere to purchase the product.






50. A shift in the demand curve resulting from consumer expectations regarding future income or future price of Goods and Services.