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Test your basic knowledge |
CLEP Macroeconomics: Measurement Of Economic Performance - 2
Start Test
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. According to Keynesian theory - this is horizontal
SRAS curve
do not
Classical Theory of Employment
contractionary fiscal policy
2. An increase in public debt will have little or no effect on real output or employment because people will choose to save more money
less
short-run
Ricardian Equivalence Theorum
crowding out effect
3. The purchase of foreign goods or services
imports
autonomous expenditure
equation of marginal propensity to import
traditional view of fiscal policy
4. Two factors that influence or change investment plans
MPC x (1 - the marginal tax rate)
expected rate of profit and real interest rate
short-run
Say's Law
5. Change in imports divided by the change in real GDP
short-run
exports
Classical Theory of Employment
equation of marginal propensity to import
6. The capitalistic economy would tend to employ its resources fully
Keynesian model
political process
expansionary fiscal policy
Classical Theory of Employment
7. Appropriate changes in government expenditures that occur naturally
MPC x (1 - the marginal tax rate)
automatic stabilizers
expected rate of profit and real interest rate
AE curve
8. 'Supply creates its own demand.'
9. Contractionary fiscal policy would be used to counteract _________
inflation
at equilibrium expenditure
Say's Law
aggregate demand
10. The amount by which a change in aggregate expenditure is multiplied to determine the change in equilibrium expenditure and real GDP
political process
Keynesian theory's criticism
multiplier
aggregate expenditure schedule
11. The average tax rate rises with GDP
4 assumptions of Classical Model
contractionary fiscal policy
progressive tax system
imports
12. Equation for MPC out of real GDP
induced expenditure
Classical Theory of Employment
MPC x (1 - the marginal tax rate)
MPC out of real GDP
13. Inventories remain at their target levels when....
4 assumptions of Classical Model
Keynesian theory's criticism
do not
at equilibrium expenditure
14. The part of aggregate planned expenditure that does not change when real GDP changes
traditional view of fiscal policy
imports
induced expenditure
autonomous expenditure
15. A decrease in government expenditures or an increase in taxes
larger
contractionary fiscal policy
LRAS curve
disposable income
16. Factors that change domestic imports
multiplier
less
automatic stabilizers
international prices - international trade agreements - and real GDP in the rest of the world
17. The level of aggregate expenditure when aggregate planned expenditure equals real GDP
equilibrium expenditure
expansionary fiscal policy
aggregate expenditure curve
automatic stabilizers
18. A change in equilibrium expenditure divided by a change in aggregate expenditure
equation to determine a multiplier
automatic stabilizers
LRAS curve
2.86
19. An increase in government expenditures or a decrease in taxes
fiscal policy
expected rate of profit and real interest rate
short-run
expansionary fiscal policy
20. (1) Pure competition; (2) Flexible wages and prices; (3) Self-interested motives; (4) People cannot be fooled by money illusions
4 assumptions of Classical Model
equilibrium expenditure
automatic stabilizers
Keynesian model
21. Changes in real GDP DO or DO NOT change domestic exports.
inflation
do not
equilibrium expenditure
crowding out effect
22. A deficit that persists during full employment
disposable income
short-run
progressive tax system
structural deficit
23. Lists the level of aggregate planned expenditure at each level of real GDP
equation of marginal propensity to import
Say's Law
exports
aggregate expenditure schedule
24. A deficit that arises out of a recession
multiplier
fiscal policy
cyclical deficit
Ricardian Equivalence Theorum
25. The magnitude of the multiplier depends on the ___ _____
AE curve
leakage
expected rate of profit and real interest rate
MPC out of real GDP
26. According to classical theory - demand for this creates unemployment
wages
increases
multiplier
do not
27. Demand side effects are large; supply side - small
traditional view of fiscal policy
cyclical deficit
inverse relationship
recession
28. Changes in real GDP DO or DO NOT change investment plans.
Keynesian model
left
political process
do not
29. The larger the MPC - the ______ the multiplier
expansionary fiscal policy
Keynesian model
SRAS curve
larger
30. Real GDP - net taxes
equilibrium expenditure
disposable income
aggregate expenditure curve
at equilibrium expenditure
31. Slope of savings function is equal to...
output
autonomous expenditure
MPS
political process
32. The time of production during which there are only essentially variable costs
exports
do not
induced expenditure
long-run
33. While investment - government spending - and exports remain constant during changes in the GDP - this kind of expenditure changes with the level of GDP
disposable income
Keynesian theory's criticism
LRAS curve
consumption expenditure
34. Fiscal Policy changes that increase or decrease equilibrium expenditure will increase or decrease _________ ________.
short-run
structural deficit
aggregate demand
output
35. If the MPC is 0.65 - what is the multiplier?
expansionary fiscal policy
Classical Theory of Employment
short-run
2.86
36. Expansionary fiscal policy would be used to counteract a _________
induced expenditure
at equilibrium expenditure
MPC x (1 - the marginal tax rate)
recession
37. According to classical theory - an increase in AD increases the price level but not the level of...
Classical Theory of Employment
Keynesian model
LRAS curve
output
38. Sizes of MPS and multiplier
inverse relationship
inflation
Classical Theory of Employment
LRAS curve
39. Made up of autonomous expenditure and induced expenditure
aggregate expenditure curve
aggregate expenditure
MPC x (1 - the marginal tax rate)
Say's Law
40. An increase in real GDP _________ imports
increases
AE curve
LRAS curve
Keynesian model
41. C + I + G + N - import function
Ricardian Equivalence Theorum
aggregate expenditure curve
structural deficit
short-run
42. Claims that expansionary fiscal policy will increase interest rates and reduce investment
crowding out effect
leakage
Ricardian Equivalence Theorum
progressive tax system
43. Savings in circular flow diagram is...
progressive tax system
leakage
automatic stabilizers
do not
44. Goods or services produced in a given nation and sold to customers in other nations
contractionary fiscal policy
exports
Say's Law
equilibrium expenditure
45. According to classical theory - this is vertical
international prices - international trade agreements - and real GDP in the rest of the world
LRAS curve
long-run
SRAS curve
46. A capitalist economy does not tend to employ its resources fully
47. Spending for the production and accumulation of capital goods and additions to inventory
aggregate expenditure
expansionary fiscal policy
investment
short-run
48. Most economic theory is based on this
Keynesian model
international prices - international trade agreements - and real GDP in the rest of the world
do not
progressive tax system
49. Changes in real GDP DO or DO NOT change government expenditure.
output
do not
increases
LRAS curve
50. The time of production during which there are fixed and variable costs
inflation
output
leakage
short-run