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Test your basic knowledge |
CLEP Macroeconomics - 3
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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. The annual percentage rate of change in price level reflected by price indexes
Marginal cost
Okun's Law
Velocity
The rate of inflation
2. The goods and services sector focuses largely on the level of ______ .
Labor unions
Law of Supply
Socially optimal quantity
Income
3. Goods like food and clothing that have a short lifespan.
Businesses
Mixed market
Capital goods
Consumer Nondurables
4. The slow change in inflation from year to year in industrialized nations
Okun's Law
Income
Inflation inertia
Indexing
5. Total supply of goods and services in an economy
LRAS
Aggregate supply
Law of Diminishing Marginal Utility
Four sectors of the economy
6. A policy that affects potential output
Supply-side policy
Real quantity
Nominal GDP
Okun's Law
7. The maximum amount that an economy can output over a period of time
Tangible Assets
Potential output
Rationing
Marginal cost
8. 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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9. Organizations that act as moderators between employers and employees
Aggregation
The principle of efficiency
Labor unions
Unemployment insurance
10. Concerned with analyzing whether or not a policy should be used.
Rationing
Normative analysis
Inflation shock
Price
11. Economic rule stating that if two items satisfy the same need and the price of one rises - people will buy the other.
Substitution effect
Exchange
Asset
Seller's surplus
12. 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.
Anchored inflation expectations
Deflation
Real employment
Labor unions
13. Total tax paid divided by total (taxable) income - as a percentage.
Interest
The Wealth Effect
Lorenz curve
Average tax rate
14. Involves increasing a nominal quantity so that it remains unaffected by increases in inflation
Business cycle
Indexing
Inflationary gap
Structural policy
15. Economies based on capitalism have microeconomic instability and that government is required to properly stabilize the economy.
Keynesian economic theory
Inside lag
Real employment
Cyclical unemployment
16. A quantity that is measured in real terms - the actual quantity of a good or service
Real quantity
Price
Free market
Liquidity
17. The degree to which people have access to goods and services that make their lives better.
Liquidity
Standard of living
Aggregate supply
Participation rate
18. 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.
Liquidity
Keynesian model
Automatic stabilizers
Price level
19. Business entity which legally has no separate existence from its owner.
Sole proprietorship
Average tax rate
Buyer's surplus
Market equilibrium
20. That efficiency leads to economic prosperity for all.
The principle of efficiency
Boom
Capitalism
Policy reaction function
21. A free market system that relies on private property ownership and supply and demand
Capitalism
LRAS
Pay
Macroeconomics
22. A Scottish man (1723-1790) who is known as the father of modern economics.
Monopsony
Gross National Product (GNP)
Adam Smith
Output gap
23. The difference between the price received by the seller and the seller's reservation price
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24. 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)
The principle of efficiency
Short run equilibrium output
Substitution effect
25. 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
Real GDP
Tangible Assets
Monopsony
The rate of inflation
26. The beginning of a recession
Peak
Sunk cost
Okun's Law
Fisher effect
27. Goods and services sector - Labor sector - monetary sector - international sector.
Four sectors of the economy
Saving
Capital goods
Tangible Assets
28. Sole proprietorships - partnerships - and corporations are private producing units of the economy knows as __________.
Partnership
Businesses
Average tax rate
Fractional
29. Extreme economic growth
Velocity
Boom
Labor productivity
Aggregate supply shock
30. A GDP decline that lasts two-quarters (six months). A period of slow economic growth
Recession
Quantity equation
Aggregation
Aggregate supply shock
31. The price of a good or service in relation to the price of other goods and services.
Law of Demand
Asset
Potential output
Relative price
32. Money multiplied by velocity equals nominal GDP.
Anchored inflation expectations
The quality adjustment bias
Quantity equation
The real GDP per person
33. The amount of workers that are willing to work for a real wage.
Labor supply
Output gap
Average tax rate
Capital income
34. 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
Tangible Assets
Seller's reservation price
Income
Substitution bias
35. The adding up of individual economic variables to obtain a large - general picture of the economy.
Command economic system
Aggregation
Four sectors of the economy
Free market
36. The portion of planned aggregate expenditure that is not based on output
Autonomous Expenditure
Economic efficiency
Peak
Labor unions
37. If the Federal Reserve lowers the reserve ratio - it ______ the bank's required reserves and ______ the quantity of money.
Substitution effect
Capitalism
Lorenz curve
decreases increases
38. Used to demonstrate shifts in income distribution among a population over time.
Relative price
Labor productivity
Lorenz curve
Expansionary policies
39. The tendency for nominal interest rates to be high when inflation rates are high and low when inflation rates are low.
Structural policy
Fisher effect
Marginal cost
Relative price
40. Most free-market banking systems are based on __________ reserves.
Laffer curve
Intermediate Goods
Core rate of inflation
Fractional
41. A phrase coined by Adam Smith to describe the process that turns self directed gain into social and economic benefits for all.
Standard of living
Relative price
Invisible hand
Indexing
42. The output per employed worker
Macroeconomics
Labor productivity
Worker mobility
Velocity
43. A result of there only being one buyer of a resource input - good - or service.
Inflationary gap
Pay
Monopsony
Partnership
44. Describes how the economy directly effects the actions policymakers take.
Law of Supply
Policy reaction function
The rate of inflation
Sunk cost
45. The total planned spending on final goods and services.
Real employment
Businesses
Planned aggregate expenditure (PAE)
Aggregate demand
46. The opposite of a substitute good - because it usually completes another item and may lead to more consumption of that item.
Worker mobility
Economic efficiency
Mixed market
Complement
47. An increase in spending due to a perceived increase in wealth.
LRAS
Four sectors of the economy
The Wealth Effect
Autonomous Expenditure
48. An extreme decline in the rate of inflation. Can lead to high levels of unemployment and recessionary gaps.
Economic efficiency
Output gap
Command economic system
Disinflation
49. The time between the need for a macroeconomic policy and its implementation
Labor supply
Inside lag
Real GDP
Invisible hand
50. The monetary sector focuses on the ________ rate.
Interest
Substitution effect
Policy reaction function
Seller's surplus