Test your basic knowledge |

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






2. 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.






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






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. 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.






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






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






8. When the price of one currency falls relative to another currency - the first currency has depreciated relative to the other one.






9. Government officials make decisions about economy.






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






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






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






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






14. The income earned by households and profits earned by firms after subtracting.






15. The efforts of entrepreneurs in organizing resources for production taking risk to create new enterprises and innovating to develop new product.






16. 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.






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






18. 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.






19. The transition point between economic recession and recovery.






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






21. 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.






22. The lowest point of a business cycle






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






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






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






26. A special tax imposed on imported goods.






27. The income of households after taxes have been paid






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






29. 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?






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






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






32. 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.






33. Rising prices - across the board.






34. Not significantly responsive to changes in price.






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






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






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






38. A country has a trade deficit if the value of its commodity imports exceeds the value of its commodity exports.






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






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






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






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






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






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






45. 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.






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






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






48. 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).






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






50. 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.