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






3. (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.






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






5. Unemployment faced by workers who have lost their jobs because of changing market (demand) conditions & whose skills don't match the requirements of available jobs.






6. 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.






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






8. A bad depressingly prolonged recession in economic activity.






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






10. 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






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






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






13. The lowest point of a business cycle






14. Consumer income rise - demand will rise.






15. 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.






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






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






18. Long- run aggregate supply curve






19. A relationship between two factors in which the factors move in opposite directions. ex: price increases - then quantity decreases.






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






21. Inflation created when an increase in the costs of production (wages or raw materials) shifts the short-run aggregate supply (AS) curve to the left; tends to push prices up while reducing the level of real GDP at the same time (stagflation).






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






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






24. 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.






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






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






27. Significantly responsive to a change in price.






28. 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.






29. 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.






30. An increase in the price level






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






32. Government officials make decisions about economy.






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






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






35. 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.






36. 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).






37. 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






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






39. 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).






40. A special tax imposed on imported goods.






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






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






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






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






45. 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.






46. Goods that go together - if price ? the demand for both that good and complimentary good ?.






47. 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.






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






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






50. The income of households after taxes have been paid