|Name: _________________________||Period: ___________________|
This test consists of 5 short answer questions, 10 short essay questions, and 1 (of 3) essay topics.
Short Answer Questions
1. Which term describes the purpose of federal spending?
2. Friedman's evidence suggests that for every $100 of government spending, a certain amount is added to income. How much?
3. How are decisions, for Friedman, made where unanimity is a costly way of making decisions?
4. Which of the following can be justified by Friedman for government interventions?
5. In Friedman's analysis, what century is the historical exception to most men living in tyranny, servitude, and misery?
Short Essay Questions
1. What examples does Friedman give of when the Federal Reserve System mismanaged the money supply?
2. What are two problems with monopolies for the liberal?
3. Friedman accepts the reasoning that justifies "governmental action to alleviate poverty" (p. 191). What two issues must be addressed in order for this to happen?
4. What does Friedman assert that capitalism has done for inequalities?
5. Explain the paternalistic argument that Friedman describes for government involvement in education.
6. What recommendations would Friedman give to a president about an economic downturn?
7. According to Friedman what is the role of government?
8. What does Friedman believe to be the cause of the Great Depression?
9. What is Friedman's definition of political freedom? Of economic freedom?
10. According to Friedman, do monopolies have any sort of "social responsibility"?
Essay Topic 1
Friedman disagrees with the multiplier effect, a Keynesian theory, reasoning for government spending. Analyze the multiplier effect and examine the man who propagates the theory, John Maynard Keynes.
Essay Topic 2
Friedman gives many historical examples to illustrate his point about the relationship between economic and political freedom. Examine these historical examples and decide whether they prove Friedman's thesis.
Essay Topic 3
Friedman argues that government mishandling of the money supply produced the Great Depression. Examine Friedman's analysis of the Great Depression and determine if the Federal Reserve System caused the Great Depression.
This section contains 1,372 words
(approx. 5 pages at 300 words per page)