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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 does Friedman believe is one drawback of the Federal Reserve having so much power?
(a) When the Federal Reserve does well, only a few profit.
(b) The Federal Reserve chairperson is elected and therefore subject to the whims of the public.
(c) The Federal Reserve has rules that are too strict to follow in order to make any real change.
(d) When the Federal Reserve makes mistakes, the whole country suffers.

2. One solution Friedman proposes is to give parents ______ for schooling.
(a) Vouchers.
(b) Coupons.
(c) Tokens.
(d) Credits.

3. What major event does Friedman strongly believe was a result of the government mishandling the money supply?
(a) World War I.
(b) None of the answers is correct.
(c) The Great Depression.
(d) Prohibition.

4. Which of the following, for Friedman, is the most important factor for the Federal Reserve?
(a) Regulation of the market.
(b) Economic growth.
(c) Stability.
(d) Loans and lending practices.

5. What does FEPC stand for?
(a) Fixing Economic Policy for Capitalism.
(b) Finding Education and People Cooperatively.
(c) Future Exercises for Preventing Catastrophes.
(d) Fair Employment Practice Commission.

Short Answer Questions

1. Friedman advocates that individuals should be able to buy and sell ______.

2. Friedman points out one idea that is often forgotten is that political and economic institutions have been ______.

3. One role of government argued by the New Deal was to ______.

4. Friedman believes that free markets are not sufficient for political freedom since many countries demonstrate the possibility of ______.

5. Which of the following does Friedman dispute?

(see the answer key)

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