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This quiz consists of 5 multiple choice and 5 short answer questions through Chapter 2, The Tyranny of Controls.

Multiple Choice Questions

1. The term human capital refers to the:
(a) output produced by a fasting
(b) machinery in the factory
(c) personal productive capacity of an individual
(d) kinds of inputs the worker uses

2. Adam Smith wrote:
(a) Das Kapital
(b) Economic Made Simple
(c) The Wealth of Nations
(d) The Price System

3. Prices function to transmit information to all but:
(a) no one in particular
(b) manufacturerr
(c) sellers
(d) buyers

4. Free international trade results in better relations between individuals who differ in all but:
(a) interests
(b) beliefs
(c) attitudes
(d) nationalities

5. What interferes with the transmittal of information by prices?
(a) actions of manufacturers
(b) Governmental control of prices
(c) actions of buyers
(d) actions of sellers

Short Answer Questions

1. Which of the following is not one of Adam Smith's duties of government?

2. Adam Smith says that voluntary exchange will not take place unless:

3. Free markets lead to:

4. Interested sophistry refers to:

5. A change in prices affects all but the following:

(see the answer key)

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