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Test your basic knowledge |
CLEP Macroeconomics - 3
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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 .
LRAS
Sunk cost
Income
Inflation inertia
2. Sole proprietorships - partnerships - and corporations are private producing units of the economy knows as __________.
Businesses
Rationing
Quantity equation
Capital income
3. The output per employed worker
Adam Smith
Labor productivity
Unemployment insurance
Frictional unemployment
4. The time between the need for a macroeconomic policy and its implementation
Price level
Market equilibrium
Inside lag
The quality adjustment bias
5. Economies based on capitalism have microeconomic instability and that government is required to properly stabilize the economy.
Liquidity
The rate of inflation
Tangible Assets
Keynesian economic theory
6. Business entity which legally has no separate existence from its owner.
Structural unemployment
Sole proprietorship
Stabilization policies
Nominal GDP
7. The price at which the number of products that businesses are willing to supply equals the amount of products that consumers are willing to buy at a specific point in time.
Equilibrium price
Laffer curve
Recession
Menu cost
8. The movement of workers between jobs - companies - and industries
Rationing
Market equilibrium
Worker mobility
Free market
9. Measures the ability of an economy to produce (output) goods and services in the short-term and the long-term.
Policy reaction function
Aggregate Supply
Real GDP
Law of Demand
10. The lowest point of the recession
Pay
Planned aggregate expenditure (PAE)
Substitution effect
Trough
11. A macroeconomic policy that directly affects the structure and various institutions of an economy
Structural policy
Anchored inflation expectations
Marginal cost
Marginal tax rate
12. The total demand for a country's output. It includes demands for consumption - investment - government purchases - and net exports.
Credibility of monetary policy
Trough
Aggregate demand
Aggregate supply shock
13. Extreme economic growth
Boom
Capital income
The quality adjustment bias
Traditional economic system
14. Money multiplied by velocity equals nominal GDP.
Quantity equation
Aggregate Supply
Aggregate demand
Consumer Nondurables
15. A quantity that is measured in real terms - the actual quantity of a good or service
Phillips curve
Real quantity
The principle of efficiency
Credibility of monetary policy
16. 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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17. A free market system that relies on private property ownership and supply and demand
Complement
Capitalism
Saving
Law of Supply
18. Combines pure market and command. Example: Japan
Credibility of monetary policy
Short run equilibrium output
Aggregation
Mixed market
19. Goods like food and clothing that have a short lifespan.
Capital goods
Consumer Nondurables
Intangible Assets
Anchored inflation expectations
20. Legal entity that has received a charter from a state or federal government.
Intermediate Goods
Short run equilibrium output
Corporation
Aggregation
21. The total value of goods and services produced in a country valued at current prices.
Boom
Nominal GDP
Outside lag
Gross National Product (GNP)
22. The increase in total benefit that comes from producing one additional unit.
Lorenz curve
Disinflation
Marginal benefit
Inflationary gap
23. A GDP decline that lasts two-quarters (six months). A period of slow economic growth
Inflation inertia
Equilibrium price
Recession
Interest
24. When the rate of inflation is extremely high.
Liquidity
Keynesian economic theory
Buyer's surplus
Hyperinflation
25. The percentage of working-age people within the labor force
Credibility of monetary policy
Deflation
decreases increases
Participation rate
26. The amount of workers that are willing to work for a real wage.
Contractionary policies
Labor supply
Economic efficiency
Monetarism
27. That efficiency leads to economic prosperity for all.
The principle of efficiency
Outside lag
Liquidity
Command economic system
28. Organizations that act as moderators between employers and employees
Law of Diminishing Marginal Utility
Capital goods
Hyperinflation
Labor unions
29. 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.
Command economic system
Price
The Wealth Effect
Inflation shock
30. 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
Disinflation
Velocity
Seller's reservation price
31. A difference between the potential output (potential GDP) of an economy and its actual output (actual GDP)
Price level
Law of Supply
Output gap
Consumer Nondurables
32. The beginning of a recession
Macroeconomics
Hyperinflation
Peak
Velocity
33. The rate of price increase on all things except food and energy
Total surplus
AD curve intersects the SAS curve
Income
Core rate of inflation
34. Maximum price that a customer is willing to pay for a good
Automatic stabilizers
Inflation
Reservation price
Income
35. Used in the production of final goods - but instead of being consumed - are available for reuse.
Pay
Capital goods
Liquidity
Trough
36. The maximum amount that an economy can output over a period of time
Anchored inflation expectations
Potential output
Lorenz curve
Seller's surplus
37. The real cost of changing a listed price.
Socially optimal quantity
Potential output
Menu cost
Real GDP
38. Government policies aimed at stabilizing the economy by eliminating output gaps
Buyer's surplus
Phillips curve
Stabilization policies
Labor productivity
39. The opposite of a substitute good - because it usually completes another item and may lead to more consumption of that item.
Substitution bias
decreases increases
Complement
Buyer's surplus
40. The labor sector highlights the rate of ____ .
Pay
Quantity equation
Unemployment insurance
Inflationary gap
41. The price of a good or service in relation to the price of other goods and services.
Consumer Nondurables
Relative price
Seller's reservation price
Excess Supply
42. The government office that is responsible for projecting federal surpluses and deficits
Relative price
Traditional economic system
Congressional budget office
Frictional unemployment
43. When both producers and consumers are satisfied with their quantities at market price.
Free market
Okun's Law
Policy reaction function
Market equilibrium
44. Goods not counted in the nation's GDP.
Trough
AD curve intersects the SAS curve
Inflation
Intermediate Goods
45. (n) something of value; a resource; an advantage
Congressional budget office
Asset
The Wealth Effect
Consumer Nondurables
46. Used to demonstrate shifts in income distribution among a population over time.
Credibility of monetary policy
The real GDP per person
Recession
Lorenz curve
47. The difference between the buyer's reservation price and the seller's reservation price. Consumer surplus + Producer surplus
Total surplus
Seller's reservation price
Hyperinflation
Complement
48. 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).
Excess Supply
Okun's Law
Frictional unemployment
Market equilibrium
49. 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.
Reservation price
Law of Supply
Real GDP
Lorenz curve
50. The rise in taxes that occurs when before-tax income increases by one dollar
Hyperinflation
Disinflation
Marginal tax rate
Relative price