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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. Goods and services sector - Labor sector - monetary sector - international sector.
Invisible hand
The real GDP per person
The Wealth Effect
Four sectors of the economy
2. The slow change in inflation from year to year in industrialized nations
Inflation inertia
Labor unions
Indexing
Aggregate demand
3. Measures the ability of an economy to produce (output) goods and services in the short-term and the long-term.
Marginal tax rate
Reservation price
Aggregate Supply
Law of Demand
4. The increase in total cost that comes from producing one additional unit of a specific good or service.
NRU
Short run equilibrium output
Marginal cost
Outside lag
5. Government policies aimed at stabilizing the economy by eliminating output gaps
Real quantity
Stabilization policies
Tangible Assets
Inflationary gap
6. In a traditional economic system - the availability of resources is based on inheritance. Goods are only produced for consumption and surpluses do not occur. This type of economy is normally found in South American - Asian - and African countries.
Traditional economic system
Real GDP
Saving
Fisher effect
7. When the rate of inflation is extremely high.
LRAS
Hyperinflation
Intermediate goods
Fisher effect
8. 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).
Inflation inertia
Supply-side policy
Frictional unemployment
Boom
9. The rate of price increase on all things except food and energy
Core rate of inflation
Fractional
Total surplus
Marginal cost
10. Goods that are used in the production of final goods.
Intermediate goods
Invisible hand
Partnership
Complement
11. Combines pure market and command. Example: Japan
Adam Smith
Sunk cost
Mixed market
Labor unions
12. The tendency for nominal interest rates to be high when inflation rates are high and low when inflation rates are low.
Fisher effect
Laffer curve
Planned aggregate expenditure (PAE)
Real employment
13. The adding up of individual economic variables to obtain a large - general picture of the economy.
Structural unemployment
Aggregation
Real quantity
Real employment
14. A Scottish man (1723-1790) who is known as the father of modern economics.
Adam Smith
Keynesian model
Real GDP
Laffer curve
15. Unicorporated entity that has shared ownership.
Okun's Law
Participation rate
Velocity
Partnership
16. 1 percent more unemployment results in 2 percent less output.
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17. The continuing increase in the average level of prices of goods and services over time.
Capitalism
Sole proprietorship
Real employment
Inflation
18. A record of economic increases and decreases over time.
Exchange
Socially optimal quantity
Business cycle
Adam Smith
19. The portion of planned aggregate expenditure that is not based on output
Autonomous Expenditure
Sole proprietorship
Laffer curve
Boom
20. 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.
Labor unions
Law of Supply
Exchange
Mixed market
21. The difference between the buyer's reservation price and the seller's reservation price. Consumer surplus + Producer surplus
Boom
Income
Complement
Total surplus
22. Real Estate - Equipment - and Cash (physical assets)
Labor supply
Intangible Assets
Tangible Assets
Laffer curve
23. Caused by changes in the overall economy.
Cyclical unemployment
Complement
Reservation price
Structural unemployment
24. When the people believe that the nation's central bank will keep inflation rates low.
Real GDP
Policy reaction function
Credibility of monetary policy
Participation rate
25. A policy that affects potential output
Business cycle
Asset
Supply-side policy
Marginal cost
26. A large - unexpected change in the cost of resources.
Aggregate supply shock
Inflation shock
AD curve intersects the SAS curve
Policy reaction function
27. The total demand for a country's output. It includes demands for consumption - investment - government purchases - and net exports.
Command economic system
Real employment
Inflation
Aggregate demand
28. Legal entity that has received a charter from a state or federal government.
Corporation
Price
Worker mobility
Price level
29. Includes payment to the owners of tangible and intangible capital items such as: factories - machines - and copyrights.
Credibility of monetary policy
Labor productivity
Capital income
Real quantity
30. Natural Rate of Unemployment - a rate that will always exist
Seller's surplus
Business cycle
NRU
Law of Demand
31. Most free-market banking systems are based on __________ reserves.
Fractional
Price
Cyclical unemployment
Normative analysis
32. 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.
Laffer curve
Expansionary policies
Command economic system
Liquidity
33. A cost that is beyond recovery the moment a consumer decides to purchase a certain good or service is made
Sunk cost
Labor unions
Participation rate
Quantity equation
34. When prices fall consistently over time - leading to negative inflation.
Nominal GDP
Worker mobility
AD curve intersects the SAS curve
Deflation
35. The value of all goods and services produced anywhere in the world by a nation's citizens during a specified amount of time.
Invisible hand
Hyperinflation
Autonomous Expenditure
Gross National Product (GNP)
36. A phrase coined by Adam Smith to describe the process that turns self directed gain into social and economic benefits for all.
Output gap
Sunk cost
Invisible hand
Recession
37. 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.
Intermediate Goods
Law of Demand
Output gap
Gross Domestic Product (GDP)
38. Patents - Goodwill - and Trademarks (lack physical substance)
Monopsony
Intangible Assets
Planned aggregate expenditure (PAE)
Intermediate goods
39. A market with unrestricted trading of goods - where the prices of goods are determined by supply and demand.
Free market
Price
Pay
Structural policy
40. There is an ___________ ___ when aggregate output is above potential output
Trough
Inflationary gap
Businesses
Tangible Assets
41. Caused by changes in demand or technology. Long-term and continual unemployment that continues even though the economy is producing normally
Monetarism
Intermediate Goods
Supply-side policy
Structural unemployment
42. 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
Substitution bias
Tangible Assets
Real GDP
Socially optimal quantity
43. Represents the governmental tax rate that will best maximize tax revenues.
Congressional budget office
Laffer curve
Real GDP
Gross National Product (GNP)
44. The rise in taxes that occurs when before-tax income increases by one dollar
Inflation shock
Intangible Assets
Invisible hand
Marginal tax rate
45. 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
Monetarism
Price level
Partnership
Command economic system
46. A free market system that relies on private property ownership and supply and demand
Autonomous Expenditure
Capitalism
decreases increases
Congressional budget office
47. An extreme decline in the rate of inflation. Can lead to high levels of unemployment and recessionary gaps.
Worker mobility
Disinflation
Outside lag
Aggregation
48. The part of economics study that looks at the operation of a nation's economy as a whole
Trough
Corporation
Macroeconomics
Labor unions
49. Short-run macroeconomic equilibrium occurs at the level of GDP where the:
Pay
Potential output
Outside lag
AD curve intersects the SAS curve
50. Government policies intended to increase spending and output.
Socially optimal quantity
Expansionary policies
Output gap
Saving