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CLEP Macroeconomics: National Income And Price Determination

Subjects : clep, economics
Instructions:
  • Answer 46 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. Equilibrium real GDP exceeds potential GDP






2. The fraction of a change in disposable income that is saved






3. Potential GDP






4. A rise in the price level at a constant money wage rate brings a change in employment and real GDP and a movement along the ___ curve.






5. Increased AD brings a(n) ___________ in SAS.






6. The government's attempt to influence the economy by setting and changing interest rates - the exchange rate - and the quantity of money






7. The relationship between the quantity of real GDP supplied and the price level when real GDP equals potential GDP; potential GDP is real GDP when all the economy's labor - capital - land - and entrepreneurial ability are fully employed






8. Sum of the quantities of all the final goods produced in the economy






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






10. A non-price related change causes a _____ in the demand curve






11. The relationship between the quantity of real GDP supplied and the price level when the money wage rate and all other influences on production plans remain constant






12. Economic slowdown






13. MPC + MPS






14. The change in savings divided by the change in disposable income






15. Change in consumption expenditure divided by the change in disposable income






16. When AD increases - the price level ________.






17. Relationship between consumption expenditure and disposable income






18. The quantity of real GDP demanded equals the quantity of real GDP supplied






19. Price levels rise due to a decrease in Short Run Aggregate Supply






20. A rise in resource costs (labor - fuel - material - etc) will _______ SAS.






21. Tendency for increases in the price level to lower the purchasing power of assets of financial assets and reduce total spending in the economy






22. Economic growth






23. A persistent increase in aggregate demand that exceeds the increase in potential GDP






24. The relationship between the quantity of real GDP supplied and the price level






25. Relationship between saving and disposable income






26. MPC






27. When potential GDP increases - both LAS and SAS curves shift _____.






28. A rise in both the price level and the money wage rate that maintains full employment brings a movement along the ____ curve.






29. Relationship between the quantity of real GDP demanded and the price level






30. When the money wage rate rises - the SAS curve shifts ____ but the LAS curve remains unchanged.






31. Increase in AD






32. Price level exceeds equilibrium price






33. People change consumption preferences daily between domestic goods and services and foreign goods and services






34. When AD increases - real GDP __________.






35. The ratio of change in consumption to change in income






36. Slopes downward






37. Real GDP and around potential GDP






38. Increase in long-term growth






39. The value of consumption goods and services bought by households






40. Disposable Income (DI) = Consumption(C) + Saving Consumption (S)






41. Indicates simultaneous change in price level and money wage rate






42. The point on a consumption function where the consumption line intersects the 45 degree line






43. When Short Run Aggregate Supply decreases - Real GDP falls below Potential GDP and the price level _________.






44. Job expectations - fiscal or monetary policy - world economy - inflation - profits






45. Equilibrium real GDP is below potential GDP






46. Decrease in AD