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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 an economic unit makes more than it spends






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






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






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






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






6. Extreme economic growth






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






8. Natural Rate of Unemployment - a rate that will always exist






9. When the people believe that the nation's central bank will keep inflation rates low.






10. Total supply of goods and services in an economy






11. Gross domestic product adjusted for inflation; gross domestic product in a year divided by the GDP price index for that year - the index expressed as a decimal






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






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






14. The movement of workers between jobs - companies - and industries






15. 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.






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






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






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






19. 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






20. The amount of workers that are willing to work for a real wage.






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






22. That efficiency leads to economic prosperity for all.






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






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






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






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






27. Caused by changes in the overall economy.






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






29. A large - unexpected change in the cost of resources.






30. Represents the governmental tax rate that will best maximize tax revenues.






31. The difference between the buyer's reservation price and the seller's reservation price. Consumer surplus + Producer surplus






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






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






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






36. Goods and services sector - Labor sector - monetary sector - international sector.






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






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






39. Involves increasing a nominal quantity so that it remains unaffected by increases in inflation






40. Money multiplied by velocity equals nominal GDP.






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






42. Most free-market banking systems are based on __________ reserves.






43. Government policies intended to avoid inflation and other effects due to increased expansion. Includes: Action such as decreasing government spending - increasing taxes - and decreasing the supply of money - and raising interest rates.






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






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






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






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






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






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






50. A policy that affects potential output