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






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






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

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






5. 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.






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






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

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8. A policy that affects potential output






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






10. 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.






11. 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






12. The tendency for nominal interest rates to be high when inflation rates are high and low when inflation rates are low.






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






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






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






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






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






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






19. The increase in total cost that comes from producing one additional unit of a specific good or service.






20. 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






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






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






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






24. The lowest point of the recession






25. The output per employed worker






26. 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.






27. Extreme economic growth






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






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






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






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






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






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






34. Caused by changes in the overall economy.






35. A quantity that is measured in real terms - the actual quantity of a good or service






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






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






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






39. Payments that the government makes to unemployed workers.






40. Legal entity that has received a charter from a state or federal government.






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






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






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






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






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






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






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






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






49. 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.






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