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






2. 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.






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






4. The study of scarcity and choice.






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






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






7. Movement up or down a single demand curve - contrasted with movement of the demand curve itself.






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






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






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






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






12. A comprehensive group of statistics that measures various aspects of the economy's performance - net exports exports minus imports.






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






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






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






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






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






18. 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.






19. 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






20. A bad depressingly prolonged recession in economic activity.






21. 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).






22. The branch of economics that deals with human behavior and choices as they relate to relatively small units--the individual - the business firm - a single market.






23. A country has a trade surplus if the value of its commodity exports exceeds the value of its commodity imports.






24. The effort of workers.






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






26. 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






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






28. 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






29. The income of households after taxes have been paid






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






31. 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.






32. Anything from the land and/or nature. Ex: minerals - timber - petroleum - cotton.






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






34. The long-run pattern of growth and recession.






35. The deliberate control of the money supply by the Federal government.






36. 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.






37. 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).






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






39. Long- run aggregate supply curve






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






41. 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.






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






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






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






45. The transition point between economic recession and recovery.






46. States that as the price of a good increases - the quantity supplied of a good increases - and as the price of a good decreases - the quantity supplied of the good decreases.






47. When the percent of change in the quantity demanded is less than then percent of change in price; when there is a small change in the quantity of a good demanded - and a large change in the price of the good.






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






49. 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






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