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Test your basic knowledge |
CLEP Macroeconomics - 3
Start Test
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. An increase in spending due to a perceived increase in wealth.
Worker mobility
Potential output
The Wealth Effect
Velocity
2. The rise in taxes that occurs when before-tax income increases by one dollar
Complement
Contractionary policies
Intermediate Goods
Marginal tax rate
3. 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
Contractionary policies
Law of Demand
Monetarism
Partnership
4. Measures the ability of an economy to produce (output) goods and services in the short-term and the long-term.
Short run equilibrium output
Aggregate Supply
Menu cost
Business cycle
5. A result of there only being one buyer of a resource input - good - or service.
Aggregation
The quality adjustment bias
Monopsony
Socially optimal quantity
6. The real cost of changing a listed price.
Credibility of monetary policy
Rationing
Menu cost
Traditional economic system
7. The time period between a policy's implementation and its desired effects on an economy.
Adam Smith
Outside lag
Fisher effect
Reservation price
8. If the Federal Reserve lowers the reserve ratio - it ______ the bank's required reserves and ______ the quantity of money.
decreases increases
Reservation price
Saving
Velocity
9. A Scottish man (1723-1790) who is known as the father of modern economics.
Income
Invisible hand
Unemployment insurance
Adam Smith
10. 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.
Real employment
Policy reaction function
Velocity
Disinflation
11. The monetary sector focuses on the ________ rate.
Aggregate supply
Interest
Anchored inflation expectations
Capital goods
12. Organizations that act as moderators between employers and employees
Output gap
Labor unions
Market equilibrium
Peak
13. The smallest dollar amount for which a seller would be willing to sell an additional unit - generally equal to marginal cost
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14. The ease with which an asset can be converted to currency.
Aggregate supply
Liquidity
Inflation shock
Corporation
15. The slow change in inflation from year to year in industrialized nations
Price level
Cyclical unemployment
Inflation inertia
Anchored inflation expectations
16. A policy that affects potential output
Supply-side policy
Average tax rate
Marginal cost
NRU
17. The tendency for nominal interest rates to be high when inflation rates are high and low when inflation rates are low.
Recession
Indexing
Fisher effect
Output gap
18. The value of all goods and services produced anywhere in the world by a nation's citizens during a specified amount of time.
Gross National Product (GNP)
Fisher effect
Economic efficiency
Complement
19. The difference between the price received by the seller and the seller's reservation price
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20. An extreme decline in the rate of inflation. Can lead to high levels of unemployment and recessionary gaps.
Real GDP
Phillips curve
Deflation
Disinflation
21. A free market system that relies on private property ownership and supply and demand
Seller's surplus
AD curve intersects the SAS curve
Law of Diminishing Marginal Utility
Capitalism
22. The opposite of a substitute good - because it usually completes another item and may lead to more consumption of that item.
Complement
Cyclical unemployment
Real quantity
Aggregate supply shock
23. A record of economic increases and decreases over time.
Business cycle
Aggregate demand
Anchored inflation expectations
The rate of inflation
24. A difference between the potential output (potential GDP) of an economy and its actual output (actual GDP)
Output gap
Deflation
Inside lag
Velocity
25. Maximum price that a customer is willing to pay for a good
Lorenz curve
Traditional economic system
Reservation price
Laffer curve
26. 1 percent more unemployment results in 2 percent less output.
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27. The level of output where output equals planned aggregate expenditure
Quantity equation
Menu cost
Outside lag
Short run equilibrium output
28. The portion of planned aggregate expenditure that is not based on output
Labor unions
Boom
Autonomous Expenditure
Seller's surplus
29. The price of a good or service in relation to the price of other goods and services.
Income
LRAS
Total surplus
Relative price
30. An increase in this would cause an increase in the aggregate supply
Frictional unemployment
LRAS
Labor productivity
Capital goods
31. The relationship between disposable income and spending on consumable goods and services
Consumption function
Cyclical unemployment
Normative analysis
Peak
32. Sole proprietorships - partnerships - and corporations are private producing units of the economy knows as __________.
The rate of inflation
Labor productivity
Businesses
Traditional economic system
33. A GDP decline that lasts two-quarters (six months). A period of slow economic growth
Recession
Okun's Law
Fractional
Laffer curve
34. Economic rule stating that if two items satisfy the same need and the price of one rises - people will buy the other.
Structural unemployment
Trough
Substitution effect
Congressional budget office
35. Business entity which legally has no separate existence from its owner.
Trough
Seller's surplus
Structural unemployment
Sole proprietorship
36. Describes how the economy directly effects the actions policymakers take.
Policy reaction function
Disinflation
Inside lag
Keynesian economic theory
37. That efficiency leads to economic prosperity for all.
Fisher effect
Rationing
The principle of efficiency
Businesses
38. The basic assumption of this model is that in the short run - firms meet demand at present price.
Inside lag
The principle of efficiency
Keynesian model
Traditional economic system
39. When quantity supplied is more than quantity demanded. The formula for excess supply is: Supply - Demand = Excess Supply
Excess Supply
Complement
Saving
Congressional budget office
40. The increase in total cost that comes from producing one additional unit of a specific good or service.
Aggregation
Marginal cost
Gross Domestic Product (GDP)
Inflation shock
41. Real Estate - Equipment - and Cash (physical assets)
Excess Supply
Tangible Assets
Consumer Nondurables
Marginal cost
42. The adding up of individual economic variables to obtain a large - general picture of the economy.
Aggregation
Consumption function
Fractional
Automatic stabilizers
43. The part of economics study that looks at the operation of a nation's economy as a whole
Macroeconomics
Marginal tax rate
Price
Seller's surplus
44. A phrase coined by Adam Smith to describe the process that turns self directed gain into social and economic benefits for all.
Mixed market
Invisible hand
Normative analysis
Pay
45. The output per employed worker
Worker mobility
Intermediate goods
Labor productivity
Pay
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
Supply-side policy
Relative price
Standard of living
47. The time between the need for a macroeconomic policy and its implementation
Contractionary policies
Inside lag
Seller's surplus
Hyperinflation
48. 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.
Monopsony
Law of Demand
The Wealth Effect
Gross Domestic Product (GDP)
49. Short-run macroeconomic equilibrium occurs at the level of GDP where the:
Adam Smith
Liquidity
Equilibrium price
AD curve intersects the SAS curve
50. Combines pure market and command. Example: Japan
Free market
Adam Smith
Capitalism
Mixed market