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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. The monetary sector focuses on the ________ rate.






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






3. When both producers and consumers are satisfied with their quantities at market price.






4. The economic theory that states the main cause of change in aggregate output and price level is the result of monetary supply and the interest rate that comes from the amount of monetary supply






5. An extreme decline in the rate of inflation. Can lead to high levels of unemployment and recessionary gaps.






6. 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.






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






8. Represents the governmental tax rate that will best maximize tax revenues.






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






10. A policy that affects potential output






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






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






13. When the rate of inflation is extremely high.






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






15. Unicorporated entity that has shared ownership.






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






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






18. A macroeconomic policy that directly affects the structure and various institutions of an economy






19. 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.






20. A phrase coined by Adam Smith to describe the process that turns self directed gain into social and economic benefits for all.






21. Total supply of goods and services in an economy






22. 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.






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






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






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






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






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






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






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






30. Caused by changes in the overall economy.






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






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






33. When inflation suddenly deviates from its normal course.






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






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






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






37. The lowest point of the recession






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






39. 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.






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






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






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






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






44. 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.






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






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






47. 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.






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






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






50. The international sector emphasizes the ________ rate.