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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. When economists fail to account for improvements in goods or services and incorrectly report inflation as higher.






2. Total tax paid divided by total (taxable) income - as a percentage.






3. 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






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






5. Organizations that act as moderators between employers and employees






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






7. When prices fall consistently over time - leading to negative inflation.






8. The beginning of a recession






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






10. The monetary sector focuses on the ________ rate.






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






12. A market with unrestricted trading of goods - where the prices of goods are determined by supply and demand.






13. The total planned spending on final goods and services.






14. 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.






15. 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.






16. When goods and services are made and consumed at the best levels for the society. Nothing more can be acheived with the resources available.






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






18. The amount spent by a household on goods and services such as: entertainment - food - and other perishables.






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






20. When people's expectations of future inflation do not change even though inflation rates change.






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






22. The annual percentage rate of change in price level reflected by price indexes






23. Government policies aimed at stabilizing the economy by eliminating output gaps






24. A policy that affects potential output






25. Goods like food and clothing that have a short lifespan.






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






27. The lowest point of the recession






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






29. Economies based on capitalism have microeconomic instability and that government is required to properly stabilize the economy.






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






31. The goods and services sector focuses largely on the level of ______ .






32. The government office that is responsible for projecting federal surpluses and deficits






33. Goods that are used in the production of final goods.






34. Patents - Goodwill - and Trademarks (lack physical substance)






35. 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.






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






37. 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.






38. 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).






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






40. Used to demonstrate shifts in income distribution among a population over time.






41. Long Run Aggregate Supply - The natural level of GDP - shown vertical on a graph. When LRAS shifts - SRAS (Short Run Aggregate Supply) will follow .






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






43. The increase in total benefit that comes from producing one additional unit.






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






45. The maximum amount that an economy can output over a period of time






46. Includes payment to the owners of tangible and intangible capital items such as: factories - machines - and copyrights.






47. Distributing a good or resource among consumers that would like to have more of that good or resource than is made available






48. 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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49. A macroeconomic policy that directly affects the structure and various institutions of an economy






50. The speed that money changes hands in order to buy and sell final goods and services.