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






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






3. Goods and services sector - Labor sector - monetary sector - international sector.






4. Money multiplied by velocity equals nominal GDP.






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






6. On a demand curve - the _____ of the item is placed on the vertical axis of the graph.






7. Government policies intended to avoid inflation and other effects due to increased expansion. Includes: Action such as decreasing government spending - increasing taxes - and decreasing the supply of money - and raising interest rates.






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






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






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






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






12. The labor sector highlights the rate of ____ .






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






14. 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.






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






16. Natural Rate of Unemployment - a rate that will always exist






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






18. Organizations that act as moderators between employers and employees






19. 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.






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






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






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






23. Unicorporated entity that has shared ownership.






24. 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.






25. The annual percentage rate of change in price level reflected by price indexes






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






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






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






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






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






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






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






33. 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).






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






35. When the rate of inflation is extremely high.






36. The lowest point of the recession






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






38. 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.






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






40. When inflation suddenly deviates from its normal course.






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






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






43. Caused by changes in the overall economy.






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






45. 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.






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






47. Short-run macroeconomic equilibrium occurs at the level of GDP where the:






48. When an economic unit makes more than it spends






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






50. The total demand for a country's output. It includes demands for consumption - investment - government purchases - and net exports.







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