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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. A free market system that relies on private property ownership and supply and demand






2. Money multiplied by velocity equals nominal GDP.






3. The beginning of a recession






4. The speed that money changes hands in order to buy and sell final goods and services.






5. That efficiency leads to economic prosperity for all.






6. When prices fall consistently over time - leading to negative inflation.






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






8. 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






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






10. The relationship between disposable income and spending on consumable goods and services






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






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






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






14. Economic rule stating that if two items satisfy the same need and the price of one rises - people will buy the other.






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






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






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






18. The lowest point of the recession






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






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






21. Organizations that act as moderators between employers and employees






22. The degree to which people have access to goods and services that make their lives better.






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






24. When inflation suddenly deviates from its normal course.






25. On a demand curve - the _____ of the item is placed on the vertical axis of the graph.






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






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






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






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






30. When an economic unit makes more than it spends






31. The total planned spending on final goods and services.






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






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






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






35. 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.






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






37. 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.






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






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






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






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






42. Payments that the government makes to unemployed workers.






43. Total supply of goods and services in an economy






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






45. 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.






46. 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.






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






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






49. The smallest dollar amount for which a seller would be willing to sell an additional unit - generally equal to marginal cost


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