Capitalism and Freedom Quiz | One Week Quiz A

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This quiz consists of 5 multiple choice and 5 short answer questions through Chapter 10, The Distribution of Income.

Multiple Choice Questions

1. What term refers to the Federal Reserve's ability to produce more money than is deposited?
(a) Reserve ability production.
(b) Overdraft protection.
(c) Percent fulfillment banking.
(d) Fractional reserve banking.

2. What example does Friedman use to argue against the redistribution of wealth?
(a) Davey Crockett.
(b) Robinson Crusoe.
(c) The Swiss Family Robinson.
(d) Mark Twain.

3. Which of the following, for Friedman, is the most important factor for the Federal Reserve?
(a) Economic growth.
(b) Regulation of the market.
(c) Loans and lending practices.
(d) Stability.

4. What does Friedman advocate the abolition of in Chapter 10, The Distribution of Income?
(a) Flat-rate income tax.
(b) Corporate income tax.
(c) Trade unions.
(d) Welfare.

5. Friedman theorizes that in extreme cases where parents don't pay for schooling, the government could provide a ______.
(a) Subsidy.
(b) Discount.
(c) Pass.
(d) Allowance.

Short Answer Questions

1. According to Friedman, what is the Federal Reserve lacking?

2. One of Friedman's claims for government involvement in education asserts that there are ______ to education.

3. What term refers to the circumstance under which the action of one individual imposes significant costs on other individuals for which it is not feasible to make him compensate them?

4. Friedman makes the distinction between education and ______.

5. According to Friedman, it can be argued that private schools ______ class distinctions, and therefore need government intervention.

(see the answer key)

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