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






2. The opposite of a substitute good - because it usually completes another item and may lead to more consumption of that item.






3. The difference between the price received by the seller and the seller's reservation price


4. The law that states that as the price of any good or service increases - the quantity of that good or service will increase and vice versa.






5. The amount spent by a household on goods and services such as: entertainment - food - and other perishables.






6. 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






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






8. Goods not counted in the nation's GDP.






9. When prices fall consistently over time - leading to negative inflation.






10. The labor sector highlights the rate of ____ .






11. A free market system that relies on private property ownership and supply and demand






12. The degree to which people have access to goods and services that make their lives better.






13. The adding up of individual economic variables to obtain a large - general picture of the economy.






14. The international sector emphasizes the ________ rate.






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


16. The total value of goods and services produced in a country valued at current prices.






17. Involves increasing a nominal quantity so that it remains unaffected by increases in inflation






18. When goods and services are made and consumed at the best levels for the society. Nothing more can be acheived with the resources available.






19. The quantity of a good that results in the maximum possible economic surplus from producing and consuming the good.






20. When the people believe that the nation's central bank will keep inflation rates low.






21. The slow change in inflation from year to year in industrialized nations






22. The time between the need for a macroeconomic policy and its implementation






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






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






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






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






27. The amount of workers that are willing to work for a real wage.






28. Government policies intended to increase spending and output.






29. The price of a good or service in relation to the price of other goods and services.






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






31. The monetary sector focuses on the ________ rate.






32. When quantity supplied is more than quantity demanded. The formula for excess supply is: Supply - Demand = Excess Supply






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






34. The basic assumption of this model is that in the short run - firms meet demand at present price.






35. The value of all goods and services produced anywhere in the world by a nation's citizens during a specified amount of time.






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






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






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






39. The smallest dollar amount for which a seller would be willing to sell an additional unit - generally equal to marginal cost


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






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






42. Real Estate - Equipment - and Cash (physical assets)






43. Patents - Goodwill - and Trademarks (lack physical substance)






44. There is an ___________ ___ when aggregate output is above potential output






45. An increase in this would cause an increase in the aggregate supply






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






47. The part of economics study that looks at the operation of a nation's economy as a whole






48. The beginning of a recession






49. A large - unexpected change in the cost of resources.






50. The level of output where output equals planned aggregate expenditure