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






2. The part of economics study that looks at the operation of a nation's economy as a whole






3. Extreme economic growth






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






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






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






7. Economic rule stating that if two items satisfy the same need and the price of one rises - people will buy the other.






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






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






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






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






12. Caused by changes in the overall economy.






13. An increase in this would cause an increase in the aggregate supply






14. Organizations that act as moderators between employers and employees






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






16. Unicorporated entity that has shared ownership.






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






18. The real cost of changing a listed price.






19. That efficiency leads to economic prosperity for all.






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






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






23. 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






24. Total tax paid divided by total (taxable) income - as a percentage.






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






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






27. 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






28. The goods and services sector focuses largely on the level of ______ .






29. The monetary sector focuses on the ________ rate.






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






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






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






33. When people's expectations of future inflation do not change even though inflation rates change.






34. Payments that the government makes to unemployed workers.






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






36. 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.






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






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






39. A policy that affects potential output






40. The degree to which people have access to goods and services that make their lives better.






41. A quantity that is measured in real terms - the actual quantity of a good or service






42. Total supply of goods and services in an economy






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






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






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






46. Describes how the economy directly effects the actions policymakers take.






47. Government policies intended to increase spending and output.






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).






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






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