|Name: _________________________||Period: ___________________|
This test consists of 15 multiple choice questions and 5 short answer questions.
Multiple Choice Questions
1. Past and current definitions of liberalism are the same with respect to ______.
(a) Paternalism and individualism.
(b) Free markets and the rule of law.
(c) Distribution of wealth and the welfare state.
(d) Civil freedoms and democracy.
2. Which type of education does Friedman not advocate the government paying for?
3. A key component of the government spending is the ______.
(a) Reduction effect.
(b) Multiplier effect.
(c) Externality effect.
(d) Substitution effect.
4. Friedman argues against the theory that $100 in government spending will increase income by ______.
5. What does Friedman claim that governments abuse?
(a) The trust of the people.
(b) Ability to issue stocks.
(c) The power to determine taxes.
(d) Commodity standards.
6. Which term describes the purpose of federal spending?
(a) "Balance beam."
(b) "Balance wheel."
(d) None of the answers is correct.
7. In Friedman's mind, why is centralization attractive to many?
(a) Streamlined services.
(b) Government can promote the public interest.
(c) Better pool of resources.
(d) Consolidation of power.
8. According to Friedman, whom does free trade benefit?
(a) The wealthier trading country.
(b) Neither trading country.
(c) The poorer trading country.
(d) Both trading countries.
9. Friedman states that government should be ______.
(d) Held accountable.
10. What does Friedman believe will markets do over time to monopolies?
(a) Strengthen them.
(b) Separate them slowly.
(c) Make them obsolete.
(d) Break them up.
11. One solution Friedman proposes is to give parents ______ for schooling.
12. Friedman advocates the end of ______.
(a) Exchange rates.
(b) Export quotas.
(c) The free market.
13. According to Friedman, what is lost when foreign exchange is controlled by the government?
(a) Educational freedom.
(b) Political freedom.
(c) Religious freedom.
(d) Economic freedom.
14. What does Friedman assert is an example of an appropriate task for government?
(a) Defining property rights.
(b) Providing for the social welfare.
(c) Determining price.
(d) Regulating the job market.
15. Friedman defines a country as a collection of ______.
Short Answer Questions
1. According to Friedman, what is the Federal Reserve lacking?
2. In Friedman's analysis, what century is the historical exception to most men living in tyranny, servitude, and misery?
3. What does Friedman believe coordinates individuals over vast distances and across all belief systems?
4. Which term refers to the government stimulating spending?
5. For Friedman, what is an all-embracing ethic?
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