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






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






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






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






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






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






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






8. Payments that the government makes to unemployed workers.






9. Combines pure market and command. Example: Japan






10. Total supply of goods and services in an economy






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






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






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






14. When an economic unit makes more than it spends






15. 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






16. 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.






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






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






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






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






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






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






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






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






25. 1 percent more unemployment results in 2 percent less output.

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






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






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






29. 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).






30. 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.






31. Extreme economic growth






32. 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.






33. That efficiency leads to economic prosperity for all.






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






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






36. Caused by changes in the overall economy.






37. Government policies intended to increase spending and output.






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






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






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






41. The economic theory that states the main cause of change in aggregate output and price level is the result of monetary supply and the interest rate that comes from the amount of monetary supply






42. A record of economic increases and decreases over time.






43. 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.






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






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






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






47. The beginning of a recession






48. When the rate of inflation is extremely high.






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






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







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