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This quiz consists of 5 multiple choice and 5 short answer questions through Chapter 3, The Control of Money.

Multiple Choice Questions

1. Which of the following does Friedman dispute?
(a) The gold standard for backing money is good.
(b) A free market economic system works.
(c) Government should stay out of individual economic choices.
(d) The Central Bank holds too much power.

2. Which of the following can be justified by Friedman for government interventions?
(a) Subsidizing farm production.
(b) Property rights.
(c) Minimum wage.
(d) The draft.

3. According to Friedman, what is a necessary condition for political freedom?
(a) Competitive capitalism.
(b) Fair trade.
(c) A high gross domestic product.
(d) Governmental regulation.

4. In Chapter 3, what does Friedman provide a history of?
(a) World War I.
(b) The Federal Reserve System.
(c) British colonialism.
(d) American monetary policy.

5. Friedman advocates that government should not be a master, but a/an ______.
(a) Philosophy.
(b) Instrument.
(c) Mechanism.
(d) Slave.

Short Answer Questions

1. What does Friedman believe is an appropriate rate of increase for the Federal Reserve?

2. Who does Friedman state rejects the view that the government is the patron or master of the citizenry?

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

4. What does Friedman claim that governments abuse?

5. According to Friedman, the market enables wide diversity, meaning power can be located in ______.

(see the answer key)

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