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CLEP Macroeconomics: Measurement Of Economic Performance - 2

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. If the MPC is 0.65 - what is the multiplier?






2. Expansionary fiscal policy would be used to counteract a _________






3. A deficit that persists during full employment






4. Dictates rises and falls in consumption expenditure






5. A deficit that arises out of a recession






6. Fiscal Policy changes that increase or decrease equilibrium expenditure will increase or decrease _________ ________.






7. The average tax rate rises with GDP






8. According to classical theory - demand for this creates unemployment






9. C + I + G + N - import function






10. When a fiscal expansion occurs at Potential GDP the Short-Run Aggregate Supply curve (SAS) shifts _____.






11. An increase in government expenditures or a decrease in taxes






12. The time of production during which there are fixed and variable costs






13. Changes in real GDP DO or DO NOT change domestic exports.






14. The level of aggregate expenditure when aggregate planned expenditure equals real GDP






15. An increase in real GDP _________ imports






16. What changes government expenditure






17. Two factors that influence or change investment plans






18. Inventories remain at their target levels when....






19. The government's attempt to influence the economy by setting and changing taxes - transfer payments - and expenditures on goods and services






20. An increase in public debt will have little or no effect on real output or employment because people will choose to save more money






21. Sizes of MPS and multiplier






22. The purchase of foreign goods or services






23. The part of aggregate planned expenditure that does not change when real GDP changes






24. Most economic theory is based on this






25. Changes in real GDP DO or DO NOT change investment plans.






26. Lists the level of aggregate planned expenditure at each level of real GDP






27. (1) Pure competition; (2) Flexible wages and prices; (3) Self-interested motives; (4) People cannot be fooled by money illusions






28. Opposite of traditional view; supply side effects are dominant






29. The magnitude of the multiplier depends on the ___ _____






30. Real GDP - net taxes






31. Savings in circular flow diagram is...






32. Factors that change domestic imports






33. A decrease in government expenditures or an increase in taxes






34. Demand side effects are large; supply side - small






35. 'Supply creates its own demand.'


36. The capitalistic economy would tend to employ its resources fully






37. According to Keynesian theory - this is horizontal






38. According to classical theory - this is vertical






39. Spending for the production and accumulation of capital goods and additions to inventory






40. The amount by which a change in aggregate expenditure is multiplied to determine the change in equilibrium expenditure and real GDP






41. A change in equilibrium expenditure divided by a change in aggregate expenditure






42. Slope of savings function is equal to...






43. Made up of autonomous expenditure and induced expenditure






44. As real GDP increases - disposable income increases - but by ___ than the increase in real GDP because net taxes also increase.






45. Appropriate changes in government expenditures that occur naturally






46. Goods or services produced in a given nation and sold to customers in other nations






47. Claims that expansionary fiscal policy will increase interest rates and reduce investment






48. Changes in real GDP DO or DO NOT change government expenditure.






49. Change in imports divided by the change in real GDP






50. The larger the MPC - the ______ the multiplier