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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. 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.






2. 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






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






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






5. The part of economics study that looks at the operation of a nation's economy as a whole






6. When the rate of inflation is extremely high.






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






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






9. Payments that the government makes to unemployed workers.






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






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






12. Total supply of goods and services in an economy






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






14. The international sector emphasizes the ________ rate.






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






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






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






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






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






20. When inflation suddenly deviates from its normal course.






21. 1 percent more unemployment results in 2 percent less output.

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22. The beginning of a recession






23. Combines pure market and command. Example: Japan






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






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






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






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






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






29. A cost that is beyond recovery the moment a consumer decides to purchase a certain good or service is made






30. Unicorporated entity that has shared ownership.






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






32. The portion of planned aggregate expenditure that is not based on output






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

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






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






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






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






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






39. A policy that affects potential output






40. The value of all goods and services produced anywhere in the world by a nation's citizens during a specified amount of time.






41. 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).






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






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






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






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






47. The movement of workers between jobs - companies - and industries






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






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






50. Government policies intended to increase spending and output.