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






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






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






4. Not significantly responsive to changes in price.






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






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






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






8. The willingness and ability of buyers to purchase a good or service.






9. 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






10. 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).






11. The income of households after taxes have been paid






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 proportion of each additional dollar of income that is saved.






14. 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.






15. 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.






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






17. The highest point of a business cycle.






18. 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).






19. 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.






20. 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.






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






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






23. The group of individuals who are either working or actively looking for work; the labor force includes the unemployed: labor force = number of individuals in labor force/number of individuals in the adult population - expressed as a percentage.






24. 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






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






26. 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






27. The branch of economics that deals with human behavior and choices as they relate to the entire economy.






28. Consumer income rise - demand will rise.






29. 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






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






31. Occurs when supply and demand are balanced such that the market price and the quantity exchanged are under no market pressure to change.






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






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






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






35. (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.






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






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






38. 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.






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






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






41. The amount of a good actually sold.






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






43. Long- run aggregate supply curve






44. Anything that can be used to produce something else






45. Government officials make decisions about economy.






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






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






48. The study of scarcity and choice.






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






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