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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 dollar value of goods and services sold to governments.






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






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






4. 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.






5. Rising prices - across the board.






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






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






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






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






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






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






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






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






14. 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).






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






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






17. The graphical representation of the law of demand. Shows the amount of a good buyers are willing and able to buy at various prices.






18. Government officials make decisions about economy.






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






20. Fluctuations in real GDP around the trend value; also called economic fluctuations.






21. Anything that shows the economy as a whole.






22. 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






23. A relationship between two factors in which the factors move in the same direction.






24. The income of households after taxes have been paid






25. Price control set when the market price is believed to be too high.






26. The lowest point of a business cycle






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






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






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. 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.






31. 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.






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






33. The branch of economics that deals with human behavior and choices as they relate to the entire economy.






34. Movement up or down a single demand curve - contrasted with movement of the demand curve itself.






35. 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).






36. An industry structure in which there is only one seller for a product.






37. 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






38. 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.






39. 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






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






41. 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.






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






43. The price of a domestic currency in terms of a foreign currency.






44. 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.






45. A very high rate of inflation - under which prices go up very rapidly - often more than 1 -000 percent in a year. This causes money to become a poor store of value.






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






47. 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.






48. Consumer income rise - demand will rise.






49. 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






50. A special tax imposed on imported goods.