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Test your basic knowledge |
CLEP Macroeconomics - 3
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Subjects
:
clep
,
economics
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 increase in total benefit that comes from producing one additional unit.
Inflation inertia
Marginal benefit
Businesses
Law of Diminishing Marginal Utility
2. Total supply of goods and services in an economy
Aggregate supply
Laffer curve
The rate of inflation
Exchange
3. Money multiplied by velocity equals nominal GDP.
Quantity equation
Mixed market
Planned aggregate expenditure (PAE)
Pay
4. An increase in this would cause an increase in the aggregate supply
Seller's surplus
Marginal benefit
Fractional
Labor productivity
5. Organizations that act as moderators between employers and employees
Labor unions
Deflation
Automatic stabilizers
Consumption
6. The labor sector highlights the rate of ____ .
Laffer curve
Automatic stabilizers
Pay
Capital income
7. The lowest point of the recession
Planned aggregate expenditure (PAE)
Macroeconomics
Trough
The quality adjustment bias
8. The continuing increase in the average level of prices of goods and services over time.
Stabilization policies
Inflation
Policy reaction function
Recession
9. Total tax paid divided by total (taxable) income - as a percentage.
The rate of inflation
Average tax rate
Trough
Inflation shock
10. Distributing a good or resource among consumers that would like to have more of that good or resource than is made available
Normative analysis
Rationing
Expansionary policies
Real GDP
11. Payments that the government makes to unemployed workers.
Intermediate Goods
Unemployment insurance
Gross National Product (GNP)
Okun's Law
12. Caused by changes in demand or technology. Long-term and continual unemployment that continues even though the economy is producing normally
Structural unemployment
Labor productivity
Aggregate demand
Deflation
13. Patents - Goodwill - and Trademarks (lack physical substance)
Laffer curve
Recession
Intangible Assets
Aggregate supply shock
14. An increase in spending due to a perceived increase in wealth.
Complement
Consumption
The Wealth Effect
Price level
15. Measures the ability of an economy to produce (output) goods and services in the short-term and the long-term.
Inflation shock
Frictional unemployment
Seller's surplus
Aggregate Supply
16. That efficiency leads to economic prosperity for all.
The principle of efficiency
Excess Supply
Traditional economic system
Consumption
17. Goods like food and clothing that have a short lifespan.
Credibility of monetary policy
Lorenz curve
Consumption function
Consumer Nondurables
18. Can be found by multiplying the average labor productivity by the percentage of people that are working in the economy.
Labor productivity
Gross Domestic Product (GDP)
Command economic system
The real GDP per person
19. The total demand for a country's output. It includes demands for consumption - investment - government purchases - and net exports.
Sunk cost
Traditional economic system
Laffer curve
Aggregate demand
20. Economies based on capitalism have microeconomic instability and that government is required to properly stabilize the economy.
Mixed market
Cyclical unemployment
Keynesian economic theory
Intermediate Goods
21. The smallest dollar amount for which a seller would be willing to sell an additional unit - generally equal to marginal cost
22. When prices fall consistently over time - leading to negative inflation.
Gross Domestic Product (GDP)
Boom
Price
Deflation
23. The degree to which people have access to goods and services that make their lives better.
Indexing
Standard of living
Asset
Consumption
24. The annual percentage rate of change in price level reflected by price indexes
LRAS
Marginal benefit
Adam Smith
The rate of inflation
25. The time between the need for a macroeconomic policy and its implementation
Inside lag
Labor supply
Corporation
The Wealth Effect
26. Includes payment to the owners of tangible and intangible capital items such as: factories - machines - and copyrights.
NRU
Congressional budget office
Capital income
Corporation
27. A Scottish man (1723-1790) who is known as the father of modern economics.
Tangible Assets
Adam Smith
AD curve intersects the SAS curve
Law of Diminishing Marginal Utility
28. When an economic unit makes more than it spends
Price
Saving
Laffer curve
Credibility of monetary policy
29. Demonstrates that there is an inverse relationship between inflation and unemployment; as inflation increases - unemployment decreases (and vice versa).
Tangible Assets
Frictional unemployment
Command economic system
Phillips curve
30. A quantity that is measured in real terms - the actual quantity of a good or service
Real quantity
Economic efficiency
Fractional
Consumption function
31. The time period between a policy's implementation and its desired effects on an economy.
Deflation
Outside lag
Exchange
NRU
32. Natural Rate of Unemployment - a rate that will always exist
Average tax rate
Stabilization policies
Aggregate Supply
NRU
33. The maximum amount that an economy can output over a period of time
The Wealth Effect
Consumer Nondurables
Potential output
Unemployment insurance
34. The percentage of working-age people within the labor force
Participation rate
Contractionary policies
Excess Supply
Real GDP
35. Unicorporated entity that has shared ownership.
The rate of inflation
Inflation
Partnership
Intangible Assets
36. When economists fail to account for improvements in goods or services and incorrectly report inflation as higher.
Marginal cost
The quality adjustment bias
Liquidity
Unemployment insurance
37. The government office that is responsible for projecting federal surpluses and deficits
Planned aggregate expenditure (PAE)
Congressional budget office
Inflation shock
Stabilization policies
38. Sole proprietorships - partnerships - and corporations are private producing units of the economy knows as __________.
Businesses
Real employment
Planned aggregate expenditure (PAE)
Partnership
39. Legal entity that has received a charter from a state or federal government.
Quantity equation
Reservation price
AD curve intersects the SAS curve
Corporation
40. Gross domestic product adjusted for inflation; gross domestic product in a year divided by the GDP price index for that year - the index expressed as a decimal
Socially optimal quantity
Labor unions
Laffer curve
Real GDP
41. The relationship between disposable income and spending on consumable goods and services
Consumption function
Monopsony
Partnership
Economic efficiency
42. Programs and economic policies such as income taxes - unemployment insurance and TANF (Temporary Aid to Needy Families) that are automatically in place - help to decrease fluctuations in the GDP.
Real GDP
Automatic stabilizers
Worker mobility
Four sectors of the economy
43. An economic system in which all factors of production are owned and controlled by the government. Often referred to as a centrally planned economic system. Example: Former Soviet Union.
Command economic system
Capital income
Law of Demand
Saving
44. The portion of planned aggregate expenditure that is not based on output
Autonomous Expenditure
Core rate of inflation
Marginal cost
Standard of living
45. Short-run macroeconomic equilibrium occurs at the level of GDP where the:
AD curve intersects the SAS curve
Traditional economic system
Core rate of inflation
Okun's Law
46. A phrase coined by Adam Smith to describe the process that turns self directed gain into social and economic benefits for all.
Invisible hand
Autonomous Expenditure
Trough
LRAS
47. An extreme decline in the rate of inflation. Can lead to high levels of unemployment and recessionary gaps.
Sunk cost
Four sectors of the economy
Disinflation
Expansionary policies
48. A cost that is beyond recovery the moment a consumer decides to purchase a certain good or service is made
Aggregate demand
LRAS
Recession
Sunk cost
49. Goods that are used in the production of final goods.
Cyclical unemployment
Intermediate goods
Saving
Macroeconomics
50. Most free-market banking systems are based on __________ reserves.
Keynesian economic theory
Labor supply
Fractional
Adam Smith