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CLEP Macroeconomics - 3

Subjects : clep, economics
  • Answer 50 questions in 15 minutes.
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  • Match each statement with the correct term.
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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. Concerned with analyzing whether or not a policy should be used.

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

3. 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.

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

5. Maximum price that a customer is willing to pay for a good

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

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

8. Long Run Aggregate Supply - The natural level of GDP - shown vertical on a graph. When LRAS shifts - SRAS (Short Run Aggregate Supply) will follow .

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

10. The labor sector highlights the rate of ____ .

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

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

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

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

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

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

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

18. When people's expectations of future inflation do not change even though inflation rates change.

19. The price at which the number of products that businesses are willing to supply equals the amount of products that consumers are willing to buy at a specific point in time.

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

21. The lowest point of the recession

22. A law stating that as the price of a product increases the demand of that product decreases - while if the price of a product decreases the demand for that product increases.

23. That efficiency leads to economic prosperity for all.

24. The output per employed worker

25. Used to demonstrate shifts in income distribution among a population over time.

26. The time period between a policy's implementation and its desired effects on an economy.

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

28. Goods that are used in the production of final goods.

29. Government policies aimed at stabilizing the economy by eliminating output gaps

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

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

32. Unicorporated entity that has shared ownership.

33. Can be found by multiplying the average labor productivity by the percentage of people that are working in the economy.

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

35. When inflation suddenly deviates from its normal course.

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

37. When the rate of inflation is extremely high.

38. The increase in total benefit that comes from producing one additional unit.

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

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

41. Economic rule stating that if two items satisfy the same need and the price of one rises - people will buy the other.

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

43. The rate of price increase on all things except food and energy

44. 1 percent more unemployment results in 2 percent less output.

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

46. The government office that is responsible for projecting federal surpluses and deficits

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

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

49. The difference between the buyer's reservation price and the seller's reservation price. Consumer surplus + Producer surplus

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