|Name: _________________________||Period: ___________________|
This test consists of 15 multiple choice questions and 5 short answer questions.
Multiple Choice Questions
1. Friedman advocates the end of ______.
(b) Exchange rates.
(c) Export quotas.
(d) The free market.
2. Friedman argues against the theory that $100 in government spending will increase income by ______.
3. According to Friedman, what is one problem with government stimulus during a recession?
(a) The measures do not take effect until after the recession.
(b) More often than not, inflation skyrockets.
(c) The stimulus is generally too small to jump-start the economy.
(d) The attempts often have a negative effect.
4. What is the name of the system with the purpose of regulating monetary policy between leading countries?
(a) The Bretton Woods System.
(b) The International Monetary System.
(c) The Gold Standard System.
(d) The World Bank System.
5. In Friedman's opinion, what will check government power?
(a) A tripartite government.
(b) The people.
(c) A free market.
(d) A strong judicial system.
6. Friedman believes that one governmental action that is justifiable is to set a ______ education level.
7. Friedman believes that all of the following are appropriate for fiscal policy except ______.
(a) Planning for stable tax rates.
(b) Spending based on community priorities.
(c) Avoiding erratic changes in spending.
(d) Fluctuating in spending based on the political climate.
8. Besides enforcing contracts, what one other thing does Friedman say government should do?
(a) Secure a country's borders.
(b) Regulate commerce.
(c) Provide for public transportation.
(d) Protect against external threats.
9. Friedman believes that vocational and professional schools should be totally ______ run.
10. Friedman points out one idea that is often forgotten is that political and economic institutions have been ______.
11. By Friedman's account, the market permits unanimity without ______.
12. Friedman defines a country as a collection of ______.
13. What is one example of a negative externality?
(b) Private education.
(c) Lack of voting.
14. Friedman believes that free markets are not sufficient for political freedom since many countries demonstrate the possibility of ______.
(a) Laissez-faire markets.
(b) Economic freedom.
(c) Authoritarian capitalism.
(d) Dictatorial government.
15. 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.
Short Answer Questions
1. In the market described by Friedman, exchanges between households are ______.
2. One solution Friedman proposes is to give parents ______ for schooling.
3. In Friedman's mind, why is centralization attractive to many?
4. Friedman asserts that government restriction centralizes ______.
5. Past and current definitions of liberalism are the same with respect to ______.
This section contains 425 words
(approx. 2 pages at 300 words per page)