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CLEP Macroeconomics - 3

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. 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






2. A Scottish man (1723-1790) who is known as the father of modern economics.






3. The real cost of changing a listed price.






4. Used in the production of final goods - but instead of being consumed - are available for reuse.






5. Measures the ability of an economy to produce (output) goods and services in the short-term and the long-term.






6. A record of economic increases and decreases over time.






7. Payments that the government makes to unemployed workers.






8. The difference between a buyer's reservation price (the price they want to pay) and the actual price paid for a good or service

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9. Caused by changes in the overall economy.






10. Most free-market banking systems are based on __________ reserves.






11. The percentage of working-age people within the labor force






12. The continuing increase in the average level of prices of goods and services over time.






13. A law stating that as a person consumes additional units of a good - eventually the utility gained from each additional unit of the good decreases.






14. Sole proprietorships - partnerships - and corporations are private producing units of the economy knows as __________.






15. When there is no cyclical unemployment and every person who wishes to work is able to find a job at the prevailing rate for wages and in the prevailing working conditions.






16. The portion of planned aggregate expenditure that is not based on output






17. Unicorporated entity that has shared ownership.






18. The ease with which an asset can be converted to currency.






19. Concerned with analyzing whether or not a policy should be used.






20. The rise in taxes that occurs when before-tax income increases by one dollar






21. The international sector emphasizes the ________ rate.






22. A flaw in the CPI that exaggerates real increases in the cost of living by failing to take into account customers ability to choose equally desirable goods or services when the price of their preferred good or service increases






23. When inflation suddenly deviates from its normal course.






24. Business entity which legally has no separate existence from its owner.






25. 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.






26. Total tax paid divided by total (taxable) income - as a percentage.






27. In a traditional economic system - the availability of resources is based on inheritance. Goods are only produced for consumption and surpluses do not occur. This type of economy is normally found in South American - Asian - and African countries.






28. An increase in spending due to a perceived increase in wealth.






29. Demonstrates that there is an inverse relationship between inflation and unemployment; as inflation increases - unemployment decreases (and vice versa).






30. 1 percent more unemployment results in 2 percent less output.

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31. A result of there only being one buyer of a resource input - good - or service.






32. Economies based on capitalism have microeconomic instability and that government is required to properly stabilize the economy.






33. 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.






34. A market with unrestricted trading of goods - where the prices of goods are determined by supply and demand.






35. When economists fail to account for improvements in goods or services and incorrectly report inflation as higher.






36. When the rate of inflation is extremely high.






37. Goods like food and clothing that have a short lifespan.






38. The speed that money changes hands in order to buy and sell final goods and services.






39. Includes payment to the owners of tangible and intangible capital items such as: factories - machines - and copyrights.






40. Caused by changes in demand or technology. Long-term and continual unemployment that continues even though the economy is producing normally






41. A difference between the potential output (potential GDP) of an economy and its actual output (actual GDP)






42. Legal entity that has received a charter from a state or federal government.






43. (n) something of value; a resource; an advantage






44. A GDP decline that lasts two-quarters (six months). A period of slow economic growth






45. Is equal to Consumption + Government Expenditures + Investment + Exports - Imports The market value of all goods and services produced within a nation during a specified amount of time.






46. If the Federal Reserve lowers the reserve ratio - it ______ the bank's required reserves and ______ the quantity of money.






47. Combines pure market and command. Example: Japan






48. The total planned spending on final goods and services.






49. Refers to individuals between jobs seeking new employment - people re-entering the workforce (ie mom whose kids are grown) - and new entrants (ie college graduates).






50. Distributing a good or resource among consumers that would like to have more of that good or resource than is made available