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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. An increase in spending due to a perceived increase in wealth.






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






3. 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






4. Measures the ability of an economy to produce (output) goods and services in the short-term and the long-term.






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






6. The real cost of changing a listed price.






7. The time period between a policy's implementation and its desired effects on an economy.






8. If the Federal Reserve lowers the reserve ratio - it ______ the bank's required reserves and ______ the quantity of money.






9. A Scottish man (1723-1790) who is known as the father of modern economics.






10. 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.






11. The monetary sector focuses on the ________ rate.






12. Organizations that act as moderators between employers and employees






13. 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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14. The ease with which an asset can be converted to currency.






15. The slow change in inflation from year to year in industrialized nations






16. A policy that affects potential output






17. The tendency for nominal interest rates to be high when inflation rates are high and low when inflation rates are low.






18. The value of all goods and services produced anywhere in the world by a nation's citizens during a specified amount of time.






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

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






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






22. The opposite of a substitute good - because it usually completes another item and may lead to more consumption of that item.






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






24. A difference between the potential output (potential GDP) of an economy and its actual output (actual GDP)






25. Maximum price that a customer is willing to pay for a good






26. 1 percent more unemployment results in 2 percent less output.

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27. The level of output where output equals planned aggregate expenditure






28. The portion of planned aggregate expenditure that is not based on output






29. The price of a good or service in relation to the price of other goods and services.






30. An increase in this would cause an increase in the aggregate supply






31. The relationship between disposable income and spending on consumable goods and services






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






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






34. Economic rule stating that if two items satisfy the same need and the price of one rises - people will buy the other.






35. Business entity which legally has no separate existence from its owner.






36. Describes how the economy directly effects the actions policymakers take.






37. That efficiency leads to economic prosperity for all.






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






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






40. The increase in total cost that comes from producing one additional unit of a specific good or service.






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






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






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






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






45. The output per employed worker






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.






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






48. 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.






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






50. Combines pure market and command. Example: Japan