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






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






4. The monetary sector focuses on the ________ rate.






5. 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






6. When an economic unit makes more than it spends






7. When inflation suddenly deviates from its normal course.






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






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






10. 1 percent more unemployment results in 2 percent less output.

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






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






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






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






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






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






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






19. The lowest point of the recession






20. That efficiency leads to economic prosperity for all.






21. When both producers and consumers are satisfied with their quantities at market price.






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






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






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






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






26. A measure of overall price levels at a specific point in the price index.






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






28. The labor sector highlights the rate of ____ .






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






30. A policy that affects potential output






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






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






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






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






35. Extreme economic growth






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






37. 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.






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






39. Real Estate - Equipment - and Cash (physical assets)






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






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






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






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






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






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






46. Combines pure market and command. Example: Japan






47. Short-run macroeconomic equilibrium occurs at the level of GDP where the:






48. When the rate of inflation is extremely high.






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






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







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