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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. 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.






2. 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.






3. The income of households after taxes have been paid






4. 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






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






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






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






8. Long- run aggregate supply curve






9. The lowest point of a business cycle






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






11. 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.






12. 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.






13. 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).






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






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






16. 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.






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






18. 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?






19. The amount of a good actually sold.






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






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






22. Not significantly responsive to changes in price.






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






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






25. Consumer income rise - demand will rise.






26. Anything that shows the economy as a whole.






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






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






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






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






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






32. When the price of one currency falls relative to another currency - the first currency has depreciated relative to the other one.






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






34. Real cost of an item is its opportunity cost.






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






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






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






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






39. 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.






40. 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.






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






42. Rising prices - across the board.






43. 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






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






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






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






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






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






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






50. A special tax imposed on imported goods.