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This quiz consists of 5 multiple choice and 5 short answer questions through Chapter 7, Capitalism and Discrimination.

Multiple Choice Questions

1. What caused all the major nations to abandon the gold standard?
(a) Decline in the value of gold.
(b) World War II.
(c) The Great Depression.
(d) World War I.

2. Friedman hypothesizes that there has been a change in discrimination along with the rise of capitalism because ______.
(a) Religion has argued equality on moral grounds.
(b) Contract arrangements replaced status as a source of wealth.
(c) There has been an increase in the population of skilled workers.
(d) Greed has overtaken all ethical values.

3. What is the basic problem of social life for Friedman?
(a) How to tax and provide responsively for the people.
(b) How to distribute wealth equitably.
(c) How to provide for entertainment opportunities.
(d) How to coordinate the economic activities of large numbers of individuals.

4. According to Friedman, what is lost when foreign exchange is controlled by the government?
(a) Economic freedom.
(b) Political freedom.
(c) Religious freedom.
(d) Educational freedom.

5. Friedman asserts that government is needed for the ______.
(a) "Rules of the road."
(b) "Rules of the game."
(c) "Rules of the system."
(d) "Rules of the citizens."

Short Answer Questions

1. According to Friedman, what is the Federal Reserve lacking?

2. Friedman's belief is that what cause would free trade substantially promote, both domestically and internationally?

3. Friedman states that the problem with teacher salaries is not that they are too low, but that they are ______.

4. For Friedman, what is something that when privately owned can be used if the price is right?

5. One solution Friedman proposes is to give parents ______ for schooling.

(see the answer key)

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