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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. When inflation suddenly deviates from its normal course.
Deflation
Inflation shock
Autonomous Expenditure
Gross National Product (GNP)
2. The time period between a policy's implementation and its desired effects on an economy.
Outside lag
Marginal cost
Supply-side policy
Participation rate
3. The total value of goods and services produced in a country valued at current prices.
Real quantity
Nominal GDP
Real GDP
Structural policy
4. 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.
Nominal GDP
Equilibrium price
Four sectors of the economy
Worker mobility
5. In a traditional economic system - the availability of resources is based on inheritance. Goods are only produced for consumption and surpluses do not occur. This type of economy is normally found in South American - Asian - and African countries.
Boom
Equilibrium price
Traditional economic system
Buyer's surplus
6. An increase in spending due to a perceived increase in wealth.
LRAS
Marginal cost
Labor supply
The Wealth Effect
7. Long Run Aggregate Supply - The natural level of GDP - shown vertical on a graph. When LRAS shifts - SRAS (Short Run Aggregate Supply) will follow .
Hyperinflation
Complement
Intangible Assets
LRAS
8. A measure of overall price levels at a specific point in the price index.
Business cycle
Price level
The principle of efficiency
Marginal cost
9. Economic rule stating that if two items satisfy the same need and the price of one rises - people will buy the other.
Price level
Substitution effect
Automatic stabilizers
Tangible Assets
10. The goods and services sector focuses largely on the level of ______ .
Income
Inflation
The quality adjustment bias
Excess Supply
11. A result of there only being one buyer of a resource input - good - or service.
Aggregate Supply
Economic efficiency
Marginal cost
Monopsony
12. 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.
Inflation
Market equilibrium
Price level
Command economic system
13. The adding up of individual economic variables to obtain a large - general picture of the economy.
Aggregation
Aggregate Supply
Expansionary policies
Nominal GDP
14. An extreme decline in the rate of inflation. Can lead to high levels of unemployment and recessionary gaps.
Potential output
Labor supply
Lorenz curve
Disinflation
15. The maximum amount that an economy can output over a period of time
Potential output
Normative analysis
Free market
Intermediate Goods
16. The increase in total benefit that comes from producing one additional unit.
Real quantity
Marginal benefit
Gross Domestic Product (GDP)
decreases increases
17. Patents - Goodwill - and Trademarks (lack physical substance)
Labor productivity
Traditional economic system
Supply-side policy
Intangible Assets
18. When an economic unit makes more than it spends
Equilibrium price
Four sectors of the economy
Saving
Trough
19. When goods and services are made and consumed at the best levels for the society. Nothing more can be acheived with the resources available.
Fisher effect
Economic efficiency
Disinflation
Inflation shock
20. Measures the ability of an economy to produce (output) goods and services in the short-term and the long-term.
Deflation
Excess Supply
NRU
Aggregate Supply
21. A GDP decline that lasts two-quarters (six months). A period of slow economic growth
Real GDP
Automatic stabilizers
Congressional budget office
Recession
22. Goods that are used in the production of final goods.
Mixed market
Intermediate goods
Socially optimal quantity
Invisible hand
23. The opposite of a substitute good - because it usually completes another item and may lead to more consumption of that item.
Gross National Product (GNP)
Substitution effect
Complement
Keynesian economic theory
24. When both producers and consumers are satisfied with their quantities at market price.
Marginal benefit
Seller's reservation price
Socially optimal quantity
Market equilibrium
25. Involves increasing a nominal quantity so that it remains unaffected by increases in inflation
Indexing
Peak
Tangible Assets
Structural policy
26. Unicorporated entity that has shared ownership.
Okun's Law
Inflation
Partnership
Unemployment insurance
27. The difference between the price received by the seller and the seller's reservation price
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28. Maximum price that a customer is willing to pay for a good
Marginal tax rate
Adam Smith
Peak
Reservation price
29. The percentage of working-age people within the labor force
Laffer curve
Exchange
Seller's reservation price
Participation rate
30. The time between the need for a macroeconomic policy and its implementation
Inside lag
Aggregation
The real GDP per person
Interest
31. Goods like food and clothing that have a short lifespan.
Automatic stabilizers
Consumer Nondurables
Pay
Indexing
32. The beginning of a recession
Adam Smith
Output gap
The real GDP per person
Peak
33. A quantity that is measured in real terms - the actual quantity of a good or service
Inflationary gap
Marginal tax rate
Participation rate
Real quantity
34. There is an ___________ ___ when aggregate output is above potential output
Relative price
Normative analysis
Aggregate Supply
Inflationary gap
35. A policy that affects potential output
Supply-side policy
Macroeconomics
Unemployment insurance
Anchored inflation expectations
36. If the Federal Reserve lowers the reserve ratio - it ______ the bank's required reserves and ______ the quantity of money.
Nominal GDP
decreases increases
Marginal cost
Real GDP
37. The degree to which people have access to goods and services that make their lives better.
Okun's Law
Core rate of inflation
Consumption
Standard of living
38. Most free-market banking systems are based on __________ reserves.
Fractional
Inflation
Participation rate
Anchored inflation expectations
39. 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.
Consumption
Automatic stabilizers
LRAS
Structural unemployment
40. The ease with which an asset can be converted to currency.
Inside lag
Liquidity
Average tax rate
Outside lag
41. The tendency for nominal interest rates to be high when inflation rates are high and low when inflation rates are low.
Free market
Consumption
Inside lag
Fisher effect
42. Can be found by multiplying the average labor productivity by the percentage of people that are working in the economy.
Mixed market
Average tax rate
Free market
The real GDP per person
43. Combines pure market and command. Example: Japan
Liquidity
Trough
Autonomous Expenditure
Mixed market
44. The amount of workers that are willing to work for a real wage.
Labor supply
Participation rate
Consumption function
Seller's reservation price
45. A large - unexpected change in the cost of resources.
Aggregate supply shock
Law of Supply
Interest
Labor unions
46. The basic assumption of this model is that in the short run - firms meet demand at present price.
Price
Aggregate supply
Relative price
Keynesian model
47. 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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48. A phrase coined by Adam Smith to describe the process that turns self directed gain into social and economic benefits for all.
Command economic system
Market equilibrium
Invisible hand
Structural policy
49. 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.
Outside lag
Standard of living
Law of Diminishing Marginal Utility
Contractionary policies
50. Organizations that act as moderators between employers and employees
Tangible Assets
Labor unions
Capital goods
Velocity