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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 output per employed worker






2. An increase in spending due to a perceived increase in wealth.






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






4. 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






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






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






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






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






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






10. A result of there only being one buyer of a resource input - good - or service.






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






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






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






14. 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.






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






16. The lowest point of the recession






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






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






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






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






22. 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






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






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






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






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






27. The goods and services sector focuses largely on the level of ______ .






28. Payments that the government makes to unemployed workers.






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






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






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






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






33. Long Run Aggregate Supply - The natural level of GDP - shown vertical on a graph. When LRAS shifts - SRAS (Short Run Aggregate Supply) will follow .






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






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

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






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






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






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






40. When the people believe that the nation's central bank will keep inflation rates low.






41. Unicorporated entity that has shared ownership.






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






43. The maximum amount that an economy can output over a period of time






44. The opposite of a substitute good - because it usually completes another item and may lead to more consumption of that item.






45. 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.






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






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






48. Money multiplied by velocity equals nominal GDP.






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






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







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