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Test your basic knowledge |
CLEP Macroeconomics - 3
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Study First
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. 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
Potential output
Marginal cost
Equilibrium price
2. Represents the governmental tax rate that will best maximize tax revenues.
Law of Supply
Credibility of monetary policy
Laffer curve
LRAS
3. Money multiplied by velocity equals nominal GDP.
Short run equilibrium output
Quantity equation
Seller's reservation price
Aggregate Supply
4. That efficiency leads to economic prosperity for all.
Exchange
Core rate of inflation
The principle of efficiency
Stabilization policies
5. When inflation suddenly deviates from its normal course.
Worker mobility
Inflation shock
Total surplus
Corporation
6. A free market system that relies on private property ownership and supply and demand
Trough
Participation rate
Structural policy
Capitalism
7. A market with unrestricted trading of goods - where the prices of goods are determined by supply and demand.
Keynesian economic theory
Free market
Market equilibrium
Credibility of monetary policy
8. 1 percent more unemployment results in 2 percent less output.
9. The international sector emphasizes the ________ rate.
Income
Exchange
Velocity
Deflation
10. Distributing a good or resource among consumers that would like to have more of that good or resource than is made available
Interest
Total surplus
Free market
Rationing
11. 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.
Intermediate goods
Asset
Outside lag
Equilibrium price
12. When goods and services are made and consumed at the best levels for the society. Nothing more can be acheived with the resources available.
Economic efficiency
Excess Supply
Equilibrium price
Expansionary policies
13. The difference between the price received by the seller and the seller's reservation price
14. The opposite of a substitute good - because it usually completes another item and may lead to more consumption of that item.
Complement
Interest
Velocity
Short run equilibrium output
15. The basic assumption of this model is that in the short run - firms meet demand at present price.
Inflationary gap
Equilibrium price
Keynesian model
Boom
16. Most free-market banking systems are based on __________ reserves.
Fractional
Expansionary policies
Tangible Assets
Short run equilibrium output
17. (n) something of value; a resource; an advantage
Asset
Peak
Marginal benefit
Capitalism
18. 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.
Consumption
Real employment
Gross National Product (GNP)
Rationing
19. Government policies intended to increase spending and output.
Expansionary policies
Real employment
Contractionary policies
Lorenz curve
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
Congressional budget office
Substitution bias
Worker mobility
Output gap
21. Used to demonstrate shifts in income distribution among a population over time.
LRAS
Structural policy
Aggregate supply shock
Lorenz curve
22. The annual percentage rate of change in price level reflected by price indexes
Real employment
Adam Smith
The rate of inflation
Autonomous Expenditure
23. On a demand curve - the _____ of the item is placed on the vertical axis of the graph.
Labor unions
Price
The Wealth Effect
Capital goods
24. The increase in total benefit that comes from producing one additional unit.
Relative price
Marginal benefit
Price level
Labor unions
25. The difference between a buyer's reservation price (the price they want to pay) and the actual price paid for a good or service
26. Can be found by multiplying the average labor productivity by the percentage of people that are working in the economy.
Gross Domestic Product (GDP)
The real GDP per person
Law of Diminishing Marginal Utility
Seller's surplus
27. Includes payment to the owners of tangible and intangible capital items such as: factories - machines - and copyrights.
Anchored inflation expectations
decreases increases
Tangible Assets
Capital income
28. A cost that is beyond recovery the moment a consumer decides to purchase a certain good or service is made
Law of Diminishing Marginal Utility
Sunk cost
Labor supply
Intermediate Goods
29. Long Run Aggregate Supply - The natural level of GDP - shown vertical on a graph. When LRAS shifts - SRAS (Short Run Aggregate Supply) will follow .
Labor supply
Laffer curve
Menu cost
LRAS
30. Used in the production of final goods - but instead of being consumed - are available for reuse.
Aggregate supply shock
Lorenz curve
Capital goods
Corporation
31. Caused by changes in the overall economy.
Mixed market
Adam Smith
Aggregate Supply
Cyclical unemployment
32. The maximum amount that an economy can output over a period of time
decreases increases
Outside lag
Policy reaction function
Potential output
33. The price of a good or service in relation to the price of other goods and services.
Consumption
Price
Relative price
Marginal tax rate
34. 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.
Peak
Inflation shock
Substitution bias
Contractionary policies
35. Goods and services sector - Labor sector - monetary sector - international sector.
Partnership
Participation rate
Four sectors of the economy
Intangible Assets
36. The tendency for nominal interest rates to be high when inflation rates are high and low when inflation rates are low.
Keynesian model
Marginal benefit
Fisher effect
Anchored inflation expectations
37. When prices fall consistently over time - leading to negative inflation.
Deflation
Credibility of monetary policy
Policy reaction function
Phillips curve
38. 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.
Boom
Seller's reservation price
Laffer curve
Law of Demand
39. The value of all goods and services produced anywhere in the world by a nation's citizens during a specified amount of time.
Okun's Law
Gross National Product (GNP)
Participation rate
Anchored inflation expectations
40. The adding up of individual economic variables to obtain a large - general picture of the economy.
Peak
Aggregation
Short run equilibrium output
Aggregate demand
41. Short-run macroeconomic equilibrium occurs at the level of GDP where the:
Expansionary policies
Sole proprietorship
AD curve intersects the SAS curve
Gross Domestic Product (GDP)
42. Organizations that act as moderators between employers and employees
Anchored inflation expectations
Substitution effect
Relative price
Labor unions
43. A result of there only being one buyer of a resource input - good - or service.
Socially optimal quantity
Total surplus
Frictional unemployment
Monopsony
44. Involves increasing a nominal quantity so that it remains unaffected by increases in inflation
Marginal cost
Core rate of inflation
Indexing
Saving
45. An increase in spending due to a perceived increase in wealth.
The Wealth Effect
Policy reaction function
Short run equilibrium output
Seller's reservation price
46. 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.
Law of Supply
Free market
Capital goods
Labor productivity
47. The part of economics study that looks at the operation of a nation's economy as a whole
Macroeconomics
Expansionary policies
Worker mobility
Keynesian model
48. Sole proprietorships - partnerships - and corporations are private producing units of the economy knows as __________.
Businesses
Asset
AD curve intersects the SAS curve
Nominal GDP
49. When people's expectations of future inflation do not change even though inflation rates change.
decreases increases
Anchored inflation expectations
Gross Domestic Product (GDP)
Four sectors of the economy
50. The rise in taxes that occurs when before-tax income increases by one dollar
Law of Supply
Partnership
Expansionary policies
Marginal tax rate