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Test your basic knowledge |
CLEP Macroeconomics - 3
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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 part of economics study that looks at the operation of a nation's economy as a whole
Supply-side policy
Excess Supply
Macroeconomics
The Wealth Effect
2. Demonstrates that there is an inverse relationship between inflation and unemployment; as inflation increases - unemployment decreases (and vice versa).
Standard of living
Monopsony
Menu cost
Phillips curve
3. Concerned with analyzing whether or not a policy should be used.
Recession
Normative analysis
Aggregate demand
Business cycle
4. Measures the ability of an economy to produce (output) goods and services in the short-term and the long-term.
Saving
Participation rate
Aggregate Supply
Price
5. When inflation suddenly deviates from its normal course.
Quantity equation
Inflation shock
Average tax rate
Sole proprietorship
6. The increase in total benefit that comes from producing one additional unit.
Disinflation
Nominal GDP
Marginal benefit
Market equilibrium
7. When the rate of inflation is extremely high.
Hyperinflation
Free market
Deflation
Nominal GDP
8. The government office that is responsible for projecting federal surpluses and deficits
Businesses
decreases increases
Law of Supply
Congressional budget office
9. The tendency for nominal interest rates to be high when inflation rates are high and low when inflation rates are low.
Fisher effect
The Wealth Effect
Keynesian economic theory
Structural policy
10. Government policies intended to increase spending and output.
Trough
Labor supply
AD curve intersects the SAS curve
Expansionary policies
11. A Scottish man (1723-1790) who is known as the father of modern economics.
Sole proprietorship
Substitution bias
Marginal benefit
Adam Smith
12. When an economic unit makes more than it spends
Recession
Inflation shock
Saving
Substitution effect
13. Involves increasing a nominal quantity so that it remains unaffected by increases in inflation
Lorenz curve
Indexing
Intermediate Goods
Inflationary gap
14. Payments that the government makes to unemployed workers.
Menu cost
Labor productivity
Monopsony
Unemployment insurance
15. The goods and services sector focuses largely on the level of ______ .
Intangible Assets
Income
Labor supply
Cyclical unemployment
16. Represents the governmental tax rate that will best maximize tax revenues.
Laffer curve
Congressional budget office
Equilibrium price
Fractional
17. If the Federal Reserve lowers the reserve ratio - it ______ the bank's required reserves and ______ the quantity of money.
Aggregate demand
Aggregate supply shock
Saving
decreases increases
18. The basic assumption of this model is that in the short run - firms meet demand at present price.
Rationing
Monopsony
Labor unions
Keynesian model
19. The increase in total cost that comes from producing one additional unit of a specific good or service.
Phillips curve
Marginal cost
Economic efficiency
decreases increases
20. Organizations that act as moderators between employers and employees
Socially optimal quantity
Labor unions
Monetarism
Equilibrium price
21. When the people believe that the nation's central bank will keep inflation rates low.
Law of Demand
Capitalism
Gross National Product (GNP)
Credibility of monetary policy
22. Short-run macroeconomic equilibrium occurs at the level of GDP where the:
Tangible Assets
Equilibrium price
Structural unemployment
AD curve intersects the SAS curve
23. The amount of workers that are willing to work for a real wage.
Business cycle
Labor supply
Fisher effect
Unemployment insurance
24. Used in the production of final goods - but instead of being consumed - are available for reuse.
Labor supply
Capital goods
Structural policy
Interest
25. 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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26. 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.
Labor unions
Automatic stabilizers
Stabilization policies
Adam Smith
27. The difference between the buyer's reservation price and the seller's reservation price. Consumer surplus + Producer surplus
Output gap
Marginal tax rate
Trough
Total surplus
28. The movement of workers between jobs - companies - and industries
Potential output
Peak
Economic efficiency
Worker mobility
29. That efficiency leads to economic prosperity for all.
Structural unemployment
Recession
Labor supply
The principle of efficiency
30. A result of there only being one buyer of a resource input - good - or service.
Credibility of monetary policy
The quality adjustment bias
Monopsony
Income
31. The total value of goods and services produced in a country valued at current prices.
Sunk cost
Nominal GDP
Real GDP
LRAS
32. When goods and services are made and consumed at the best levels for the society. Nothing more can be acheived with the resources available.
Normative analysis
Outside lag
Labor productivity
Economic efficiency
33. The slow change in inflation from year to year in industrialized nations
Inflation inertia
Lorenz curve
Menu cost
The Wealth Effect
34. The rate of price increase on all things except food and energy
Core rate of inflation
Law of Diminishing Marginal Utility
Standard of living
Socially optimal quantity
35. The rise in taxes that occurs when before-tax income increases by one dollar
Credibility of monetary policy
Price
Labor unions
Marginal tax rate
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.
Traditional economic system
The real GDP per person
Aggregation
Adam Smith
37. The total demand for a country's output. It includes demands for consumption - investment - government purchases - and net exports.
Command economic system
Aggregate demand
Disinflation
Inflation shock
38. Money multiplied by velocity equals nominal GDP.
Fractional
Autonomous Expenditure
Quantity equation
Core rate of inflation
39. The opposite of a substitute good - because it usually completes another item and may lead to more consumption of that item.
Complement
Disinflation
Market equilibrium
Consumption
40. A quantity that is measured in real terms - the actual quantity of a good or service
Core rate of inflation
Law of Demand
Aggregation
Real quantity
41. Goods not counted in the nation's GDP.
Intermediate Goods
Mixed market
Seller's surplus
Unemployment insurance
42. The monetary sector focuses on the ________ rate.
Complement
Labor supply
Marginal tax rate
Interest
43. Economic rule stating that if two items satisfy the same need and the price of one rises - people will buy the other.
Intermediate Goods
Substitution effect
Sunk cost
Marginal tax rate
44. Economies based on capitalism have microeconomic instability and that government is required to properly stabilize the economy.
The rate of inflation
Buyer's surplus
Keynesian economic theory
NRU
45. Legal entity that has received a charter from a state or federal government.
Marginal tax rate
Structural unemployment
Corporation
Credibility of monetary policy
46. The value of all goods and services produced anywhere in the world by a nation's citizens during a specified amount of time.
Gross National Product (GNP)
Interest
Traditional economic system
Consumption function
47. Total tax paid divided by total (taxable) income - as a percentage.
Market equilibrium
Output gap
Average tax rate
Business cycle
48. The adding up of individual economic variables to obtain a large - general picture of the economy.
Labor unions
Real quantity
Income
Aggregation
49. The real cost of changing a listed price.
Phillips curve
Labor productivity
Tangible Assets
Menu cost
50. Distributing a good or resource among consumers that would like to have more of that good or resource than is made available
Unemployment insurance
Rationing
Macroeconomics
Four sectors of the economy