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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. The payment that capital receives in the factor market.






2. 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.






3. The lowest point of a business cycle






4. 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).






5. Anything that can be used to produce something else






6. 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.






7. 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






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






9. 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.






10. Resource is unavailable in sufficient amounts to satisfy various ways society wants to use it.






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






12. 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.






13. The highest point of a business cycle.






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






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






16. 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.






17. The effort of workers.






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






20. An increase in the price level






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






22. 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.






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






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






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






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






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






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






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






31. Anything from the land and/or nature. Ex: minerals - timber - petroleum - cotton.






32. The study of scarcity and choice.






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






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






35. 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).






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






37. 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.






38. 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.






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






40. 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.






41. 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).






42. Consumer income rise - demand will rise.






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






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






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






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






47. Rising prices - across the board.






48. Short-run aggregate supply curve






49. 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.






50. 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.