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






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






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






5. Money multiplied by velocity equals nominal GDP.






6. When both producers and consumers are satisfied with their quantities at market price.






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






8. 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.






9. Unicorporated entity that has shared ownership.






10. 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.






11. Organizations that act as moderators between employers and employees






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






13. Business entity which legally has no separate existence from its owner.






14. The beginning of a recession






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






16. When quantity supplied is more than quantity demanded. The formula for excess supply is: Supply - Demand = Excess Supply






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






18. Government policies intended to increase spending and output.






19. A measure of overall price levels at a specific point in the price index.






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






21. The real cost of changing a listed price.






22. 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.






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






24. The international sector emphasizes the ________ rate.






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






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






27. The rise in taxes that occurs when before-tax income increases by one dollar






28. Legal entity that has received a charter from a state or federal government.






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






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






31. That efficiency leads to economic prosperity for all.






32. 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).






33. 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.






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






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






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






37. The relationship between disposable income and spending on consumable goods and services






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






39. 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.






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






41. The tendency for nominal interest rates to be high when inflation rates are high and low when inflation rates are low.






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






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






44. 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.






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






46. Extreme economic growth






47. Goods not counted in the nation's GDP.






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






49. 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






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