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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. Can be found by multiplying the average labor productivity by the percentage of people that are working in the economy.






2. 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.






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






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






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






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






7. There is an ___________ ___ when aggregate output is above potential output






8. A cost that is beyond recovery the moment a consumer decides to purchase a certain good or service is made






9. 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).






10. When an economic unit makes more than it spends






11. A law stating that as a person consumes additional units of a good - eventually the utility gained from each additional unit of the good decreases.






12. When inflation suddenly deviates from its normal course.






13. 1 percent more unemployment results in 2 percent less output.

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






15. The beginning of a recession






16. Total supply of goods and services in an economy






17. A policy that affects potential output






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






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






20. Used in the production of final goods - but instead of being consumed - are available for reuse.






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






22. The quantity of a good that results in the maximum possible economic surplus from producing and consuming the good.






23. On a demand curve - the _____ of the item is placed on the vertical axis of the graph.






24. The percentage of working-age people within the labor force






25. Concerned with analyzing whether or not a policy should be used.






26. The total demand for a country's output. It includes demands for consumption - investment - government purchases - and net exports.






27. The continuing increase in the average level of prices of goods and services over time.






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






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






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






31. The output per employed worker






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






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






34. 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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35. The rate of price increase on all things except food and energy






36. The real cost of changing a listed price.






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






38. Payments that the government makes to unemployed workers.






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






40. When the rate of inflation is extremely high.






41. Money multiplied by velocity equals nominal GDP.






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






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






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






45. The total value of goods and services produced in a country valued at current prices.






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






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






48. Demonstrates that there is an inverse relationship between inflation and unemployment; as inflation increases - unemployment decreases (and vice versa).






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






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