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CLEP Macroeconomics: Measurement Of Economic Performance - 2

Subjects : clep, economics
  • Answer 50 questions in 15 minutes.
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  • Match each statement with the correct term.
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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 time of production during which there are only essentially variable costs

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

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

4. A capitalist economy does not tend to employ its resources fully

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

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

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

8. An increase in real GDP _________ imports

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

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

11. Savings in circular flow diagram is...

12. Factors that change domestic imports

13. Dictates rises and falls in consumption expenditure

14. A deficit that arises out of a recession

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

16. According to classical theory - this is vertical

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

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

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

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

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

22. A deficit that persists during full employment

23. The larger the MPC - the ______ the multiplier

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

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

26. The part of aggregate planned expenditure that does change when real GDP changes

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

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

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

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

31. Sizes of MPS and multiplier

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

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

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

35. According to Keynesian theory - this is horizontal

36. Two factors that influence or change investment plans

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

38. According to classical theory - an increase in AD increases the price level but not the level of...

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

40. Most economic theory is based on this

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

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

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

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

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

46. The purchase of foreign goods or services

47. What changes government expenditure

48. Contractionary fiscal policy would be used to counteract _________

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

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