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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. 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






2. Unemployment that reflects changes in the business cycle; the difference between the official unemployment rate & the natural rate of unemployment.






3. 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






4. Long- run aggregate supply curve






5. Changes - adjustments - and strategies that the governments implements in spending or taxation to achieve particular economic goals.






6. 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.






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






8. The lowest point of a business cycle






9. 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.






10. Total revenue (TR) price of a good multiplied by the number of units sold; TR = P*Q.






11. Expenditure by businesses on plant and equipment and the change in business invention.






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






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






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






15. 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.






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






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






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






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






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






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






22. 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.






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






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






25. 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






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






27. The study of scarcity and choice.






28. 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.






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






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






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






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






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






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






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






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






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






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






39. The income of households after taxes have been paid






40. The effort of workers.






41. 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.






42. Price control set when the market price is believed to be too high.






43. The transition point between economic recession and recovery.






44. Not significantly responsive to changes in price.






45. 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






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






47. An increase in the price level






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






49. The highest point of a business cycle.






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