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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. Government policies intended to increase spending and output.
Expansionary policies
Recession
Sole proprietorship
Price level
2. 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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3. Concerned with analyzing whether or not a policy should be used.
Short run equilibrium output
Four sectors of the economy
Normative analysis
Quantity equation
4. Real Estate - Equipment - and Cash (physical assets)
Market equilibrium
Tangible Assets
Real quantity
Marginal cost
5. Goods that are used in the production of final goods.
Okun's Law
The principle of efficiency
Economic efficiency
Intermediate goods
6. Long Run Aggregate Supply - The natural level of GDP - shown vertical on a graph. When LRAS shifts - SRAS (Short Run Aggregate Supply) will follow .
LRAS
Inside lag
Monetarism
Potential output
7. Money multiplied by velocity equals nominal GDP.
Gross National Product (GNP)
Short run equilibrium output
Quantity equation
Stabilization policies
8. Legal entity that has received a charter from a state or federal government.
Marginal cost
Indexing
Corporation
Inflation
9. 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.
Laffer curve
Automatic stabilizers
Potential output
Autonomous Expenditure
10. A measure of overall price levels at a specific point in the price index.
Contractionary policies
Congressional budget office
Supply-side policy
Price level
11. When economists fail to account for improvements in goods or services and incorrectly report inflation as higher.
The quality adjustment bias
NRU
Credibility of monetary policy
Substitution bias
12. When people's expectations of future inflation do not change even though inflation rates change.
Planned aggregate expenditure (PAE)
Structural unemployment
Potential output
Anchored inflation expectations
13. A policy that affects potential output
Saving
Phillips curve
Income
Supply-side policy
14. If the Federal Reserve lowers the reserve ratio - it ______ the bank's required reserves and ______ the quantity of money.
Autonomous Expenditure
decreases increases
Business cycle
Total surplus
15. An increase in this would cause an increase in the aggregate supply
Inflation
Labor productivity
Short run equilibrium output
Monopsony
16. A quantity that is measured in real terms - the actual quantity of a good or service
Real quantity
Equilibrium price
Indexing
Supply-side policy
17. The price of a good or service in relation to the price of other goods and services.
Businesses
Peak
Aggregate supply shock
Relative price
18. Sole proprietorships - partnerships - and corporations are private producing units of the economy knows as __________.
Interest
Total surplus
Businesses
Aggregate supply
19. 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
Outside lag
Substitution bias
Businesses
Short run equilibrium output
20. The basic assumption of this model is that in the short run - firms meet demand at present price.
The Wealth Effect
Keynesian model
Corporation
Unemployment insurance
21. The goods and services sector focuses largely on the level of ______ .
Income
Inside lag
Substitution bias
Relative price
22. 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)
Labor unions
Consumer Nondurables
Disinflation
23. Demonstrates that there is an inverse relationship between inflation and unemployment; as inflation increases - unemployment decreases (and vice versa).
Invisible hand
Phillips curve
Rationing
Relative price
24. The ease with which an asset can be converted to currency.
Expansionary policies
Sunk cost
Liquidity
Four sectors of the economy
25. Involves increasing a nominal quantity so that it remains unaffected by increases in inflation
Indexing
Seller's reservation price
Keynesian model
Consumer Nondurables
26. The difference between the price received by the seller and the seller's reservation price
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27. The portion of planned aggregate expenditure that is not based on output
Four sectors of the economy
Intermediate goods
Autonomous Expenditure
Corporation
28. The rate of price increase on all things except food and energy
Gross National Product (GNP)
Automatic stabilizers
Core rate of inflation
The quality adjustment bias
29. Payments that the government makes to unemployed workers.
Output gap
Interest
Unemployment insurance
Sole proprietorship
30. The speed that money changes hands in order to buy and sell final goods and services.
Fractional
Mixed market
Velocity
Inflation shock
31. The increase in total cost that comes from producing one additional unit of a specific good or service.
Credibility of monetary policy
Liquidity
Economic efficiency
Marginal cost
32. Goods like food and clothing that have a short lifespan.
Consumer Nondurables
Congressional budget office
Phillips curve
Short run equilibrium output
33. The lowest point of the recession
Trough
Price
Buyer's surplus
Anchored inflation expectations
34. The total demand for a country's output. It includes demands for consumption - investment - government purchases - and net exports.
Labor productivity
Marginal tax rate
Okun's Law
Aggregate demand
35. 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).
Marginal tax rate
Frictional unemployment
Supply-side policy
Law of Supply
36. The annual percentage rate of change in price level reflected by price indexes
Seller's reservation price
Aggregate demand
Aggregation
The rate of inflation
37. Represents the governmental tax rate that will best maximize tax revenues.
Law of Supply
Laffer curve
Anchored inflation expectations
Liquidity
38. The output per employed worker
Adam Smith
Sunk cost
Seller's reservation price
Labor productivity
39. 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.
Credibility of monetary policy
Gross Domestic Product (GDP)
Intangible Assets
Marginal tax rate
40. The degree to which people have access to goods and services that make their lives better.
Monopsony
Inflationary gap
Standard of living
Output gap
41. A cost that is beyond recovery the moment a consumer decides to purchase a certain good or service is made
Sunk cost
Anchored inflation expectations
Capitalism
Exchange
42. A Scottish man (1723-1790) who is known as the father of modern economics.
Price
Equilibrium price
Saving
Adam Smith
43. The opposite of a substitute good - because it usually completes another item and may lead to more consumption of that item.
Complement
Business cycle
Potential output
Exchange
44. A difference between the potential output (potential GDP) of an economy and its actual output (actual GDP)
Excess Supply
Output gap
Phillips curve
Inside lag
45. The increase in total benefit that comes from producing one additional unit.
Marginal benefit
Intangible Assets
Credibility of monetary policy
Monopsony
46. The real cost of changing a listed price.
Monetarism
Menu cost
Tangible Assets
Structural unemployment
47. Business entity which legally has no separate existence from its owner.
Substitution effect
Sunk cost
Sole proprietorship
Contractionary policies
48. An extreme decline in the rate of inflation. Can lead to high levels of unemployment and recessionary gaps.
Velocity
Businesses
Disinflation
Core rate of inflation
49. Maximum price that a customer is willing to pay for a good
Potential output
Intermediate Goods
The rate of inflation
Reservation price
50. The tendency for nominal interest rates to be high when inflation rates are high and low when inflation rates are low.
Fisher effect
Corporation
Marginal cost
NRU