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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. Long Run Aggregate Supply - The natural level of GDP - shown vertical on a graph. When LRAS shifts - SRAS (Short Run Aggregate Supply) will follow .
Anchored inflation expectations
LRAS
Law of Demand
Policy reaction function
2. The monetary sector focuses on the ________ rate.
Interest
Consumption function
Liquidity
Inflation inertia
3. 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
Phillips curve
Free market
Liquidity
Real GDP
4. 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.
Anchored inflation expectations
Credibility of monetary policy
Command economic system
Core rate of inflation
5. Goods that are used in the production of final goods.
Economic efficiency
Intermediate goods
Inflation inertia
decreases increases
6. Total tax paid divided by total (taxable) income - as a percentage.
Phillips curve
Average tax rate
Real employment
Boom
7. Business entity which legally has no separate existence from its owner.
Tangible Assets
Sole proprietorship
Partnership
Exchange
8. Patents - Goodwill - and Trademarks (lack physical substance)
The Wealth Effect
Economic efficiency
Phillips curve
Intangible Assets
9. Organizations that act as moderators between employers and employees
Labor unions
Potential output
Recession
Consumption
10. When prices fall consistently over time - leading to negative inflation.
Businesses
Aggregation
Deflation
Pay
11. A free market system that relies on private property ownership and supply and demand
Automatic stabilizers
Adam Smith
Planned aggregate expenditure (PAE)
Capitalism
12. Government policies intended to increase spending and output.
Expansionary policies
decreases increases
Price level
Planned aggregate expenditure (PAE)
13. 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.
The rate of inflation
Marginal cost
Policy reaction function
Gross Domestic Product (GDP)
14. Payments that the government makes to unemployed workers.
Supply-side policy
Consumption function
Partnership
Unemployment insurance
15. The part of economics study that looks at the operation of a nation's economy as a whole
Macroeconomics
Aggregation
Expansionary policies
Aggregate supply
16. The output per employed worker
Nominal GDP
Labor productivity
Worker mobility
Inflation inertia
17. 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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18. Total supply of goods and services in an economy
Aggregate supply
Consumer Nondurables
Sunk cost
Peak
19. The relationship between disposable income and spending on consumable goods and services
Real quantity
Consumption function
Relative price
Marginal cost
20. A result of there only being one buyer of a resource input - good - or service.
Intermediate Goods
Exchange
Monopsony
Real GDP
21. When the people believe that the nation's central bank will keep inflation rates low.
Credibility of monetary policy
Gross Domestic Product (GDP)
Invisible hand
Liquidity
22. Goods not counted in the nation's GDP.
Total surplus
Outside lag
Anchored inflation expectations
Intermediate Goods
23. 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
Aggregation
Lorenz curve
Consumption function
24. An increase in spending due to a perceived increase in wealth.
Saving
The Wealth Effect
Laffer curve
Nominal GDP
25. The opposite of a substitute good - because it usually completes another item and may lead to more consumption of that item.
Supply-side policy
Law of Supply
Complement
Labor supply
26. There is an ___________ ___ when aggregate output is above potential output
Consumption function
Capital goods
Consumption
Inflationary gap
27. 1 percent more unemployment results in 2 percent less output.
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28. The lowest point of the recession
Gross Domestic Product (GDP)
Phillips curve
Monetarism
Trough
29. The amount spent by a household on goods and services such as: entertainment - food - and other perishables.
Reservation price
Real employment
Inflation shock
Consumption
30. Demonstrates that there is an inverse relationship between inflation and unemployment; as inflation increases - unemployment decreases (and vice versa).
Nominal GDP
Peak
Phillips curve
Anchored inflation expectations
31. When an economic unit makes more than it spends
Saving
Frictional unemployment
Business cycle
The principle of efficiency
32. The percentage of working-age people within the labor force
Labor productivity
Boom
Participation rate
Inflation shock
33. Real Estate - Equipment - and Cash (physical assets)
Monetarism
Policy reaction function
Tangible Assets
Contractionary policies
34. The movement of workers between jobs - companies - and industries
Law of Diminishing Marginal Utility
Adam Smith
Marginal tax rate
Worker mobility
35. Distributing a good or resource among consumers that would like to have more of that good or resource than is made available
Potential output
Short run equilibrium output
Inflation inertia
Rationing
36. Government policies aimed at stabilizing the economy by eliminating output gaps
Stabilization policies
Substitution effect
Traditional economic system
Inflation
37. A law stating that as a person consumes additional units of a good - eventually the utility gained from each additional unit of the good decreases.
Core rate of inflation
Income
Law of Diminishing Marginal Utility
Velocity
38. The continuing increase in the average level of prices of goods and services over time.
Inflation
Real GDP
Indexing
Supply-side policy
39. Involves increasing a nominal quantity so that it remains unaffected by increases in inflation
Rationing
Indexing
Normative analysis
Aggregate supply
40. The total demand for a country's output. It includes demands for consumption - investment - government purchases - and net exports.
Quantity equation
Aggregate demand
Okun's Law
Normative analysis
41. Economies based on capitalism have microeconomic instability and that government is required to properly stabilize the economy.
Keynesian economic theory
Business cycle
Monopsony
Partnership
42. The beginning of a recession
Peak
Real employment
AD curve intersects the SAS curve
Marginal tax rate
43. A phrase coined by Adam Smith to describe the process that turns self directed gain into social and economic benefits for all.
Congressional budget office
Disinflation
Law of Supply
Invisible hand
44. A market with unrestricted trading of goods - where the prices of goods are determined by supply and demand.
The principle of efficiency
Hyperinflation
Four sectors of the economy
Free market
45. Describes how the economy directly effects the actions policymakers take.
Okun's Law
decreases increases
Supply-side policy
Policy reaction function
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.
Saving
Law of Supply
Exchange
Participation rate
47. Sole proprietorships - partnerships - and corporations are private producing units of the economy knows as __________.
Businesses
Keynesian economic theory
Saving
Buyer's surplus
48. Unicorporated entity that has shared ownership.
Seller's reservation price
Consumer Nondurables
Partnership
Cyclical unemployment
49. The rate of price increase on all things except food and energy
Hyperinflation
Normative analysis
Aggregate supply
Core rate of inflation
50. The total value of goods and services produced in a country valued at current prices.
Aggregation
Nominal GDP
Liquidity
Gross National Product (GNP)