Test your basic knowledge |

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. Anything that can be used to produce something else






2. 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






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






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






5. The study of scarcity and choice.






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






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






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






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






11. 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.






12. Will shift either to the left(decrease) in demand - or to the right(increase) in demand; shift is caused by a change in one of the non-price determinates for the good.






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






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






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






16. A table showing quantities of a good demanded at varying prices; a table demonstrating the number of units of a good demanded at various points.






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






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






20. The transition point between economic recession and recovery.






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






23. Not significantly responsive to changes in price.






24. Consumer income rise - demand will rise.






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






26. The lowest point of a business cycle






27. The amount of a good actually sold.






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






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






30. 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.






31. The difference between the maximum price a consume is (or would be) willing to pay and the price he or she actually pays.






32. 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.






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






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






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






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






37. 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).






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






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






40. 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.






41. Anything that shows the economy as a whole.






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






43. 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?






44. 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






45. 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.






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






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






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






49. 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.






50. Unemployment faced by workers who have lost their jobs because of changing market (demand) conditions & who have transferable skills; unemployment due to the natural frictions of the economy.