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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. 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.






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






3. A period of slow economic growth - usually accompanied by rising unemployment; two consecutive quarters of declining output.






4. Nominal GDP corrected for inflation; real GDP is calculated using prices from a given base year - which may not be the same as the year being measured or the year in which the calculations are made. Real GDP allows economists to compare changes in pr






5. 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.






6. The amount of a good actually sold.






7. 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).






8. Mathematical approximation used to measure the effect of economic growth; this rule tells us the approximate number of years it will take for some measure (real GDP - price level - savings account - etc.) to double given a known annual percentage inc






9. Price control set when the market price is believed to be too low.






10. A shift of the demand curve resulting from a change in consumer taste and preferences.






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






12. The proportion of each additional dollar of income that will go toward consumption expenditures.






13. A very high rate of inflation - under which prices go up very rapidly - often more than 1 -000 percent in a year. This causes money to become a poor store of value.






14. When Price and TR move in opposite directions..... P?/TR? or P?/TR?






15. Restrictions on the quantity of a good that can be imported






16. A good for which there is less demand as income rises; a good the demand for which falls as income rises and rises as income falls; consumer income rises while demand decreases.






17. The dollar value of production by a country's citizens.






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






19. Long- run aggregate supply curve






20. Period in which a recession becomes prolonged and deep - involving high unemployment.






21. A person who has been unemployed and searching for a job for so long - that they have given up on finding a job and therefore forfeit unemployment.






22. A bad depressingly prolonged recession in economic activity.






23. States that as prices rise - people are willing and able to buy less of a good and - hence - the quantity demanded decreases; as prices fall - people are willing and able to buy more - so the quantity demanded increases and the demand curve slopes do






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






25. A measure of the price level - or the average level of prices.






26. A relationship between two factors in which the factors move in the same direction.






27. Law stating that as a price of a good increases - the quantity demanded of the good decreases - and vice versa.






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






29. The payment that capital receives in the factor market.






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






31. Anything that can be used to produce something else






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






33. A special tax imposed on imported goods.






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






35. The percentage of the civilian labor force that is unemployed. The number of persons unemployed divided by the number of persons in the civilian labor force (expressed as a percentage).






36. 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.






37. The income earned by households and profits earned by firms after subtracting.






38. The conflict between limited resources and unlimited human wants; the basic economic problem facing all societies.






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






40. The cost of something in terms of what one must give up to get it.






41. (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.






42. Not significantly responsive to changes in price.






43. Decisions by individuals about what to do and what not to do.






44. Monetary policy methods by which the Fed aims to increase the money supply and lower interest rates - thereby creating an increase in output; in pursuit of expansionary policy goals - the Fed can lower the required reserve ratio - lower the discount






45. The gross domestic product calculated using current-year prices; for example - the nominal GDP for 2001 would calculate the value of production using2001 prices for goods and services. Nominal GDP can vary widely from year to year - due to forces suc






46. A civilian - non-institutionalized adult is considered to be unemployed when he or she does not have a job but is actively looking for one; unemployment figures reflect the number of individuals meeting this definition who are parts of the labor forc






47. The amount of money available to consumers to purchase goods and services.






48. Period in which the economy moves from a trough to a peak and a real GDP is increasing; also called a boom.






49. 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?






50. A way of measuring the GDP by adding up all spending on final goods and services during a given year.






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