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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. Short-run macroeconomic equilibrium occurs at the level of GDP where the:
Saving
AD curve intersects the SAS curve
Unemployment insurance
Market equilibrium
2. A measure of overall price levels at a specific point in the price index.
Socially optimal quantity
Price level
LRAS
The quality adjustment bias
3. When the rate of inflation is extremely high.
Market equilibrium
Output gap
Hyperinflation
Exchange
4. The tendency for nominal interest rates to be high when inflation rates are high and low when inflation rates are low.
Consumption
Intermediate Goods
Anchored inflation expectations
Fisher effect
5. A free market system that relies on private property ownership and supply and demand
Reservation price
Marginal tax rate
Capitalism
Gross Domestic Product (GDP)
6. The lowest point of the recession
Trough
Buyer's surplus
Traditional economic system
Command economic system
7. The beginning of a recession
Standard of living
Peak
Complement
Menu cost
8. Goods that are used in the production of final goods.
Real quantity
Trough
Marginal benefit
Intermediate goods
9. The annual percentage rate of change in price level reflected by price indexes
Short run equilibrium output
Income
The rate of inflation
Disinflation
10. The rate of price increase on all things except food and energy
Law of Demand
Aggregate demand
Core rate of inflation
Free market
11. Economic rule stating that if two items satisfy the same need and the price of one rises - people will buy the other.
Okun's Law
Substitution effect
Mixed market
Saving
12. 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.
Complement
Standard of living
Outside lag
Automatic stabilizers
13. The part of economics study that looks at the operation of a nation's economy as a whole
Macroeconomics
Economic efficiency
Gross National Product (GNP)
The Wealth Effect
14. 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
NRU
Labor productivity
Monetarism
Marginal cost
15. Goods and services sector - Labor sector - monetary sector - international sector.
Four sectors of the economy
Real employment
Disinflation
Menu cost
16. An increase in this would cause an increase in the aggregate supply
Exchange
Labor productivity
Monetarism
Capital goods
17. Caused by changes in the overall economy.
Cyclical unemployment
Capital income
Credibility of monetary policy
Four sectors of the economy
18. When goods and services are made and consumed at the best levels for the society. Nothing more can be acheived with the resources available.
The Wealth Effect
Short run equilibrium output
Economic efficiency
Inflation shock
19. The opposite of a substitute good - because it usually completes another item and may lead to more consumption of that item.
Planned aggregate expenditure (PAE)
Complement
Recession
Corporation
20. The relationship between disposable income and spending on consumable goods and services
Structural unemployment
Worker mobility
Consumption function
Unemployment insurance
21. A result of there only being one buyer of a resource input - good - or service.
Monopsony
Aggregation
Worker mobility
Intermediate Goods
22. An increase in spending due to a perceived increase in wealth.
The Wealth Effect
Businesses
Exchange
Peak
23. The total value of goods and services produced in a country valued at current prices.
Participation rate
Anchored inflation expectations
Nominal GDP
Standard of living
24. On a demand curve - the _____ of the item is placed on the vertical axis of the graph.
Price
Frictional unemployment
Planned aggregate expenditure (PAE)
Law of Demand
25. The ease with which an asset can be converted to currency.
Liquidity
Anchored inflation expectations
Labor productivity
Quantity equation
26. 1 percent more unemployment results in 2 percent less output.
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27. Legal entity that has received a charter from a state or federal government.
Corporation
Inflation inertia
Saving
LRAS
28. Long Run Aggregate Supply - The natural level of GDP - shown vertical on a graph. When LRAS shifts - SRAS (Short Run Aggregate Supply) will follow .
Aggregate supply shock
Adam Smith
Capitalism
LRAS
29. A policy that affects potential output
Labor supply
Supply-side policy
Credibility of monetary policy
Price
30. The percentage of working-age people within the labor force
Participation rate
Standard of living
Law of Supply
Deflation
31. 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.
Gross National Product (GNP)
Gross Domestic Product (GDP)
Mixed market
Anchored inflation expectations
32. If the Federal Reserve lowers the reserve ratio - it ______ the bank's required reserves and ______ the quantity of money.
Expansionary policies
Congressional budget office
decreases increases
Inflation
33. Distributing a good or resource among consumers that would like to have more of that good or resource than is made available
Capital goods
Keynesian economic theory
AD curve intersects the SAS curve
Rationing
34. A difference between the potential output (potential GDP) of an economy and its actual output (actual GDP)
Buyer's surplus
Output gap
Peak
Aggregate demand
35. The continuing increase in the average level of prices of goods and services over time.
Real employment
Intermediate Goods
Economic efficiency
Inflation
36. 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.
Indexing
Traditional economic system
Command economic system
Nominal GDP
37. The time between the need for a macroeconomic policy and its implementation
Inside lag
Reservation price
Socially optimal quantity
Real employment
38. Government policies intended to increase spending and output.
Total surplus
Businesses
Invisible hand
Expansionary policies
39. Government policies aimed at stabilizing the economy by eliminating output gaps
Exchange
Expansionary policies
Stabilization policies
Equilibrium price
40. The increase in total cost that comes from producing one additional unit of a specific good or service.
The rate of inflation
Real quantity
Aggregate supply shock
Marginal cost
41. The difference between the buyer's reservation price and the seller's reservation price. Consumer surplus + Producer surplus
Equilibrium price
decreases increases
Total surplus
Structural unemployment
42. The international sector emphasizes the ________ rate.
Exchange
Inside lag
Hyperinflation
Participation rate
43. Involves increasing a nominal quantity so that it remains unaffected by increases in inflation
Indexing
Buyer's surplus
Asset
Participation rate
44. Maximum price that a customer is willing to pay for a good
Excess Supply
Rationing
Reservation price
Substitution bias
45. The maximum amount that an economy can output over a period of time
Liquidity
Buyer's surplus
Relative price
Potential output
46. 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
Interest
Worker mobility
Capital goods
Real GDP
47. The slow change in inflation from year to year in industrialized nations
Inflation inertia
Hyperinflation
Contractionary policies
Credibility of monetary policy
48. The portion of planned aggregate expenditure that is not based on output
Relative price
Keynesian economic theory
Autonomous Expenditure
Labor unions
49. Payments that the government makes to unemployed workers.
Gross National Product (GNP)
Average tax rate
Unemployment insurance
Inside lag
50. The difference between the price received by the seller and the seller's reservation price
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