|Name: _________________________||Period: ___________________|
This test consists of 15 multiple choice questions and 5 short answer questions.
Multiple Choice Questions
1. 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?
(a) The neighborhood effect.
(b) The future growth principle.
(c) The common principle.
(d) The colleague effect.
2. What does Friedman prefer when it comes to exchange rates?
(a) Hovering exchange rates.
(b) Rising exchange rates?
(c) Floating exchange rates.
(d) Sinking exchange rates.
3. Friedman points out one idea that is often forgotten is that political and economic institutions have been ______.
4. According to Friedman, which of the following is the least bad?
(a) Private monopoly.
(b) Public regulation.
(c) Private regulation.
(d) Public monopoly.
5. According to Friedman, what is lost when foreign exchange is controlled by the government?
(a) Economic freedom.
(b) Educational freedom.
(c) Political freedom.
(d) Religious freedom.
6. What does Friedman say can government not duplicate?
(a) The creativity of the individual.
(b) The free market economic system.
(c) An international monitoring system.
(d) The power of local control.
7. Friedman believes that free markets are not sufficient for political freedom since many countries demonstrate the possibility of ______.
(a) Authoritarian capitalism.
(b) Laissez-faire markets.
(c) Economic freedom.
(d) Dictatorial government.
8. Friedman argues against the theory that $100 in government spending will increase income by ______.
9. Friedman states that government should be ______.
10. Friedman states that government should be ______.
(b) Held accountable.
11. Friedman makes the distinction between education and ______.
12. In the market described by Friedman, exchanges between households are ______.
13. The thought that the best use of government spending would be on useless projects is known as ______.
(a) "Steaming the water."
(b) "Emptying the pot."
(c) "Evening it out."
(d) "Filling holes."
14. What does Friedman claim that governments abuse?
(a) The trust of the people.
(b) The power to determine taxes.
(c) Commodity standards.
(d) Ability to issue stocks.
15. According to Friedman, what is liberty's greatest enemy?
(a) Elected leaders.
(b) The Federal government.
(c) Concentration of power.
(d) The educational system.
Short Answer Questions
1. In Friedman's eyes, individual activities correspond to game players as the framework of law corresponds to______.
2. One of Friedman's claims for government involvement in education asserts that there are ______ to education.
3. In Friedman's mind, why is centralization attractive to many?
4. Friedman believes that economic control can lead to infringements on ______.
5. Which term refers to the government stimulating spending?
This section contains 425 words
(approx. 2 pages at 300 words per page)