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






2. 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).






3. 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






4. Long- run aggregate supply curve






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






6. The income of households after taxes have been paid






7. 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






8. 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.






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






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






11. A special tax imposed on imported goods.






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






13. An increase or decrease in consumer income will cause a shift in the Demand Curve.






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






15. 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






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






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






18. 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.






19. 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.






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






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






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






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






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






25. An increase in the price level






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






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






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






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






30. 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






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






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






33. 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






34. Anything that shows the economy as a whole.






35. 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.






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






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






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






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






40. 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).






41. 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.






42. 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.






43. 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).






44. Short-run aggregate supply curve






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






46. The study of scarcity and choice.






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






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






49. Government officials make decisions about economy.






50. 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.