CLEP Principles of Macroeconomics Readiness Test

10 questions, balanced across the exam's topics. Answer each one, then submit for your practice readiness estimate and per-topic breakdown. This is a practice estimate — not a prediction or guarantee of your official exam result.

Question 1

The exchange quote is 28/5 foreign-currency units per U.S. dollar. How many foreign units does $68 buy, ignoring fees?

368/5 28/5 1904/5 85/7

Question 2

In a simple fixed-price model with no taxes, imports, or crowding out, MPC=2/5. Autonomous spending rises by 26. What is the equilibrium output increase?

52/5 26 130/3 -130/3

Question 3

A student writes the following study note. Which heading is the most precise fit? Money serves as a medium of exchange when it is accepted for purchases.

Bank loan and deposit creation Monetary base Money demand and interest Medium of exchange

Question 4

Which example most directly illustrates GDP deflator?

A report adds consumption, investment, government purchases, and exports minus imports. A price index is computed from the ratio of nominal output value to its real-output measure. A price statistic follows the cost of a specified household consumption basket over time. A qualified worker spends several weeks finding an appropriate new job after moving.

Question 5

Which term or topic best matches the following description? A report measures borrowing still outstanding from past financing decisions.

Tax multiplier Fiscal implementation lag Public debt stock Menu costs

Question 6

The exchange quote is 12/5 foreign-currency units per U.S. dollar. How many foreign units does $52 buy, ignoring fees?

12/5 65/3 272/5 624/5

Question 7

Disposable income increases by 240, and consumption increases by 144. What is MPC?

96 5/3 3/5 2/5

Question 8

Nominal interest is 14% and inflation is 1%. Using 1+r=(1+i)/(1+π), what is the exact real rate as a percentage?

1300/101 13 -1300/101 15

Question 9

Match each description to its most specific topic, in the order shown. I. Predictable enforcement reduces uncertainty about retaining returns from long-term investment. II. Adding another identical machine yields less extra output when labor and knowledge remain unchanged.

I: Institutions and growth; II: Technological progress I: Physical capital accumulation; II: Diminishing returns to capital I: Diminishing returns to capital; II: Institutions and growth I: Institutions and growth; II: Diminishing returns to capital

Question 10

Which statement most accurately describes Crowding out?

Government borrowing can reduce private investment through higher interest rates under relevant model conditions. Higher expected inflation can shift the short-run Phillips curve upward. Higher policy-related interest rates can restrain interest-sensitive spending and demand pressure. In the basic fixed-price model with lump-sum taxes, equal changes in purchases and taxes can have a net multiplier of one.

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