|Name: _________________________||Period: ___________________|
This test consists of 15 multiple choice questions and 5 short answer questions.
Multiple Choice Questions
1. For Friedman, what is one major problem in interpreting the evidence on the distribution of income?
(a) Lack of data.
(b) Reliable empirical evidence.
(c) Temporary vs. long run income status.
(d) Defining poverty levels.
2. What type of society does Friedman believe is least materialistic?
3. Who said, "There is much ruin in a nation"?
(a) Carl Menger.
(b) Adam Smith.
(c) John Maynard Keynes.
(d) Milton Friedman.
4. According to Friedman, what is one major cost of the extension of governmental welfare activities?
(a) Decline in private charitable activities.
(b) Higher taxes with low results.
(c) Lower productivity of labor.
(d) Increased regulation of private organizations.
5. According to Friedman, a liberal will welcome measures that promote what?
(a) Wealth and freedom.
(b) Elimination of poverty.
(c) Freedom and equality.
(d) Power and politics.
6. Who does Friedman believe is most critical of capitalism?
7. What has been more potent for progress than the visible hand for retrogression according to Friedman?
(a) Transparent hand.
(b) Invisible hand.
(c) Hidden hand.
(d) None of the answers is correct.
8. What is one argument Friedman gives for public housing?
(a) The law of supply effect.
(b) The law of demand effect.
(c) The neighborhood effect.
(d) The paternalism effect.
9. Which group does Friedman believe to be contradictory in their views on free speech and fair employment laws?
10. What example does Friedman use to demonstrate his views on employment practices?
(a) A blacksmith.
(b) A lawyer.
(c) A baker.
(d) A grocer.
11. For Friedman, what is the main argument for licensure?
12. What industry sector is most prevalent in monopoly?
13. According to Friedman, who benefits from licensure?
(a) Licensed practitioners.
14. Which type of monopoly does Friedman believe is least bad?
(a) Labor monopoly.
(b) Private monopoly.
(c) Government monopoly.
(d) Government regulation.
15. What is the relationship between capitalism and the fraction of income paid for capital in countries?
Short Answer Questions
1. What is the term for making non-membership in a union a condition of employment?
2. In Chapter 10, The Distribution of Income, what was the chief characteristic of progress and development over the past century?
3. To what previous restrictions on labor does Friedman compare licenses?
4. Another threat for Friedman to the preservation and expansion of freedom is:
5. What industry does Friedman use to argue against licensure?
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