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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.
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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. Represents the governmental tax rate that will best maximize tax revenues.
Menu cost
Law of Demand
Buyer's surplus
Laffer curve
2. The difference between the price received by the seller and the seller's reservation price
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3. Natural Rate of Unemployment - a rate that will always exist
NRU
Free market
Worker mobility
Aggregation
4. The speed that money changes hands in order to buy and sell final goods and services.
Automatic stabilizers
Velocity
Okun's Law
Stabilization policies
5. Total supply of goods and services in an economy
Aggregate supply
Interest
Quantity equation
Capital income
6. Organizations that act as moderators between employers and employees
Price
Velocity
Labor unions
Credibility of monetary policy
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.
LRAS
Contractionary policies
Adam Smith
Stabilization policies
8. 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).
Frictional unemployment
Consumption function
Stabilization policies
Consumer Nondurables
9. Government policies aimed at stabilizing the economy by eliminating output gaps
Stabilization policies
Liquidity
Average tax rate
Fisher effect
10. The lowest point of the recession
Menu cost
Trough
Intangible Assets
Liquidity
11. An increase in this would cause an increase in the aggregate supply
Labor productivity
Equilibrium price
Interest
Intangible Assets
12. 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.
Real GDP
Businesses
Law of Demand
Corporation
13. Business entity which legally has no separate existence from its owner.
Sole proprietorship
Autonomous Expenditure
Labor supply
Output gap
14. The ease with which an asset can be converted to currency.
Liquidity
Seller's surplus
Reservation price
Nominal GDP
15. A free market system that relies on private property ownership and supply and demand
Velocity
Capitalism
Total surplus
Output gap
16. The movement of workers between jobs - companies - and industries
The rate of inflation
Outside lag
Marginal benefit
Worker mobility
17. Goods and services sector - Labor sector - monetary sector - international sector.
Liquidity
Frictional unemployment
Four sectors of the economy
Anchored inflation expectations
18. Extreme economic growth
Socially optimal quantity
Boom
Adam Smith
AD curve intersects the SAS curve
19. The slow change in inflation from year to year in industrialized nations
Participation rate
Business cycle
Inflation inertia
Lorenz curve
20. The level of output where output equals planned aggregate expenditure
Inflation shock
LRAS
Short run equilibrium output
Rationing
21. The amount of workers that are willing to work for a real wage.
Complement
Marginal cost
Aggregate demand
Labor supply
22. An extreme decline in the rate of inflation. Can lead to high levels of unemployment and recessionary gaps.
Income
Automatic stabilizers
Short run equilibrium output
Disinflation
23. The output per employed worker
Keynesian economic theory
Labor productivity
Unemployment insurance
Substitution effect
24. Caused by changes in the overall economy.
Output gap
Keynesian model
Consumption
Cyclical unemployment
25. The total planned spending on final goods and services.
Excess Supply
Planned aggregate expenditure (PAE)
Frictional unemployment
Substitution effect
26. A market with unrestricted trading of goods - where the prices of goods are determined by supply and demand.
Structural unemployment
Peak
Free market
Credibility of monetary policy
27. The value of all goods and services produced anywhere in the world by a nation's citizens during a specified amount of time.
Inflation
Partnership
Gross National Product (GNP)
Frictional unemployment
28. 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.
Traditional economic system
Aggregate demand
Trough
Law of Diminishing Marginal Utility
29. The smallest dollar amount for which a seller would be willing to sell an additional unit - generally equal to marginal cost
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30. The increase in total cost that comes from producing one additional unit of a specific good or service.
Credibility of monetary policy
Consumer Nondurables
Marginal cost
Real quantity
31. The amount spent by a household on goods and services such as: entertainment - food - and other perishables.
decreases increases
Law of Demand
Aggregate Supply
Consumption
32. Sole proprietorships - partnerships - and corporations are private producing units of the economy knows as __________.
The rate of inflation
Keynesian economic theory
Disinflation
Businesses
33. The degree to which people have access to goods and services that make their lives better.
Inflation
Capital goods
Aggregate supply
Standard of living
34. That efficiency leads to economic prosperity for all.
Mixed market
The principle of efficiency
Trough
Market equilibrium
35. The increase in total benefit that comes from producing one additional unit.
Expansionary policies
Marginal benefit
Lorenz curve
Price
36. 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
Credibility of monetary policy
Consumption
Structural unemployment
Substitution bias
37. When prices fall consistently over time - leading to negative inflation.
Short run equilibrium output
Deflation
Outside lag
Free market
38. The government office that is responsible for projecting federal surpluses and deficits
LRAS
Adam Smith
Intermediate goods
Congressional budget office
39. When quantity supplied is more than quantity demanded. The formula for excess supply is: Supply - Demand = Excess Supply
Normative analysis
Consumption
NRU
Excess Supply
40. 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.
Economic efficiency
Command economic system
Consumption function
Liquidity
41. The portion of planned aggregate expenditure that is not based on output
Credibility of monetary policy
Corporation
Autonomous Expenditure
Intangible Assets
42. Maximum price that a customer is willing to pay for a good
Reservation price
NRU
Marginal cost
Gross National Product (GNP)
43. The annual percentage rate of change in price level reflected by price indexes
Inflationary gap
NRU
The rate of inflation
Cyclical unemployment
44. A quantity that is measured in real terms - the actual quantity of a good or service
Real quantity
Peak
Reservation price
Potential output
45. When both producers and consumers are satisfied with their quantities at market price.
Real employment
Anchored inflation expectations
Market equilibrium
Standard of living
46. A policy that affects potential output
Command economic system
Supply-side policy
The quality adjustment bias
Substitution effect
47. 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
Laffer curve
Monetarism
Real GDP
Consumption
48. 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.
Mixed market
Equilibrium price
Substitution bias
Structural policy
49. If the Federal Reserve lowers the reserve ratio - it ______ the bank's required reserves and ______ the quantity of money.
Price level
Rationing
Structural policy
decreases increases
50. Economies based on capitalism have microeconomic instability and that government is required to properly stabilize the economy.
Business cycle
Keynesian economic theory
Law of Diminishing Marginal Utility
Rationing
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