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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. 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.






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






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






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






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






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






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






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






9. 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.






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






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






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






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






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






15. Patents - Goodwill - and Trademarks (lack physical substance)






16. Money multiplied by velocity equals nominal GDP.






17. When an economic unit makes more than it spends






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






19. Organizations that act as moderators between employers and employees






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






21. The difference between the price received by the seller and the seller's reservation price


22. 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.






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






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






25. 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.






26. When the rate of inflation is extremely high.






27. Government policies intended to increase spending and output.






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






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






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






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






32. The real cost of changing a listed price.






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






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






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






36. That efficiency leads to economic prosperity for all.






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






38. Extreme economic growth






39. The slow change in inflation from year to year in industrialized nations






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






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






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






43. 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.






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






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






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






47. A phrase coined by Adam Smith to describe the process that turns self directed gain into social and economic benefits for all.






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






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






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