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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 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






2. Goods that are used in the production of final goods.






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






4. Goods not counted in the nation's GDP.






5. A GDP decline that lasts two-quarters (six months). A period of slow economic growth






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






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

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8. 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.






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






10. Legal entity that has received a charter from a state or federal government.






11. 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.






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






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






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






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






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






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






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






19. Natural Rate of Unemployment - a rate that will always exist






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






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






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






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






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






25. Total supply of goods and services in an economy






26. Caused by changes in the overall economy.






27. Used to demonstrate shifts in income distribution among a population over time.






28. 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.






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






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






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






32. Unicorporated entity that has shared ownership.






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






34. When the rate of inflation is extremely high.






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






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






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






38. Government policies intended to increase spending and output.






39. The labor sector highlights the rate of ____ .






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






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






42. 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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43. Patents - Goodwill - and Trademarks (lack physical substance)






44. Programs and economic policies such as income taxes - unemployment insurance and TANF (Temporary Aid to Needy Families) that are automatically in place - help to decrease fluctuations in the GDP.






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






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






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






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






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






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