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






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






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






4. The study of scarcity and choice.






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






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






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






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






9. 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.






10. The long-run pattern of growth and recession.






11. 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.






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






13. 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






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






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






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






17. 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






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






19. 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.






20. 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.






21. 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).






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






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






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






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






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






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






28. 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.






29. A bad depressingly prolonged recession in economic activity.






30. 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).






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






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






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






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






35. The income of households after taxes have been paid






36. Consumer income rise - demand will rise.






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






38. 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).






39. 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.






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






41. 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).






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






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






44. The highest point of a business cycle.






45. Period in which the economy moves from a trough to a peak and a real GDP is increasing; also called a boom.






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






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






48. 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.






49. 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.






50. 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.