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Test your basic knowledge |
AP Macroeconomics
Start Test
Study First
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 willingness and ability of buyers to purchase a good or service.
diminishing marginal utility
national economic accounts
demand
SRAS curve
2. 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).
stagflation
depression
expansionary fiscal policy
import quotas
3. The lowest point of a business cycle
consumer good
disposable personal income
quantity exchanged
trough
4. Economic tool used to determine exactly the amount of the new demand deposits that can be created from an initial deposit.
price ceiling
money multiplier
market economy
demand curve shifts
5. The income earned by households and profits earned by firms after subtracting.
tariff
inflation
national income (NI)
Marginal Propensity to Save (MPS)
6. Anything that can be used to produce something else
resource
expansionary fiscal policy
aggregate demand curve
real GDP
7. 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.
neutral good
inelastic
elastic demand
entrepreneurship
8. The study of scarcity and choice.
opportunity cost
economics
frictional unemployment
trough
9. The proportion of each additional dollar of income that will go toward consumption expenditures.
land
market demand curve
number of composition of consumers
marginal propensity to consume (MPC)
10. Anything that shows the economy as a whole.
market demand curve
Gross National Product
economic aggregates
Ceteris Paribus (sayr-iht-us pahr-ih-bos)
11. The sum of all the quantities of a good supplies by all producers at each price.
market supply curve
disposable personal income
consumer income rise
command economy
12. Decisions by individuals about what to do and what not to do.
price floor
individual choice
scarce
demand schedule
13. 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.
microeconomics
susbtitute goods
inelastic
opportunity cost
14. A measure of the price level - or the average level of prices.
price index
opportunity cost
structural unemployment
nominal GDP
15. Not significantly responsive to changes in price.
cost-push inflation
peak
business cycles
inelastic
16. Period in which a recession becomes prolonged and deep - involving high unemployment.
depression
unemployment rate
market economy
inferior good
17. 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.
aggregate supply curve
individual choice
disposable personal income
change in quantity demanded
18. 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.
microeconomics
total revenue
law of supply
unemployment rate
19. When the price of one currency falls relative to another currency - the first currency has depreciated relative to the other one.
quantity exchanged
inflation
entrepreneurship
depreciation
20. A shift of the demand curve resulting from a change in consumer taste and preferences.
unemployment rate
consumer taste and preferences
price floor
demand
21. A country has a trade surplus if the value of its commodity exports exceeds the value of its commodity imports.
land
trade surplus
economics
market economy
22. 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
market supply curve
economic aggregates
expansionary monetary policy
hidden unemployment
23. 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.
demand-pull inflation
A decrease in TR following an increase in price = elastic demand
normal good
law of demand
24. Changes - adjustments - and strategies that the governments implements in spending or taxation to achieve particular economic goals.
opportunity cost
hyperinflation
expansion
fiscal policy
25. The long-run pattern of growth and recession.
entrepreneurship
exchange rate
business cycle
consumer good
26. Significantly responsive to a change in price.
depression
neutral good
elastic
national income (NI)
27. A special tax imposed on imported goods.
changes in consumer expectations
Ceteris Paribus (sayr-iht-us pahr-ih-bos)
change in quantity demanded
tariff
28. 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).
consumer surplus
law of demand
market demand curve
monetary policy
29. A curve depicting the relationship between real GDP demanded (i.e. - expenditures) and the price level in the economy; the aggregate demand curve slopes downward from left to right.
aggregate demand curve
elastic demand
economic aggregates
market supply curve
30. A shift in the demand curve resulting from consumer expectations regarding future income or future price of Goods and Services.
market economy
elastic
individual choice
changes in consumer expectations
31. The deliberate control of the money supply by the Federal government.
price ceiling
law of demand
monetary policy
inelastic demand
32. Period in which the economy moves from a trough to a peak and a real GDP is increasing; also called a boom.
microeconomics
required reserve ratio (RRR)
expansion
monopoly
33. 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
change in quantity demanded
inelastic demand
government expenditures
law of demand
34. The branch of economics that deals with human behavior and choices as they relate to the entire economy.
hyperinflation
national income (NI)
opportunity cost
macroeconomics
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.
LRAS curv
substitution effect
market demand curve
demand curve shifts
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).
inverse relationship
investment expenditures
unemployment rate
cost-push inflation
37. The income of households after taxes have been paid
elastic demand
exchange rate
rule of 70
disposable personal income
38. An industry structure in which there is only one seller for a product.
inelastic
trade deficit
scarce
monopoly
39. 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?
inverse relationship
demand elasticity
complimentary goods
government expenditures
40. Unemployment that reflects changes in the business cycle; the difference between the official unemployment rate & the natural rate of unemployment.
disposable personal income
quantity exchanged
cyclical unemployment
cost-push inflation
41. 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.
frictional unemployment
law of demand
hyperinflation
consumer taste and preferences
42. Consumer income rise - demand will rise.
trade surplus
entrepreneurship
market economy
neutral good
43. A bad depressingly prolonged recession in economic activity.
entrepreneurship
depression
opportunity cost
consumer good
44. 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.
perfectly elastic
investment expenditures
inflation
expansion
45. Resource is unavailable in sufficient amounts to satisfy various ways society wants to use it.
Gross National Product
fiscal policy
consumer taste and preferences
scarce
46. 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
nominal GDP
structural unemployment
depreciation
scarcity
47. Rising prices - across the board.
inflation
market economy
demand curve shifts
direct relationship
48. 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.
demand-pull inflation
labor force
complimentary goods
depression
49. A period of slow economic growth - usually accompanied by rising unemployment; two consecutive quarters of declining output.
diminishing marginal utility
recession
substitution effect
command economy
50. Decisions of individual producers and consumers determine what how and for whom to reduce. Minor Government interference. Economy is run by itself.
demand schedule
market economy
economics
purchasing power