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This quiz consists of 5 multiple choice and 5 short answer questions through Chapter 4, International and Financial Trade Arrangements.

Multiple Choice Questions

1. One role of government argued by the New Deal was to ______.
(a) Regulate military spending.
(b) Provide subsidies for the poor.
(c) Even out economic cycles.
(d) Eliminate excessive alcohol drinking.

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

3. Friedman asserts that government restriction centralizes ______.
(a) Wealth.
(b) Elitism.
(c) Goods.
(d) Power.

4. According to Friedman, whom does free trade benefit?
(a) Neither trading country.
(b) The poorer trading country.
(c) The wealthier trading country.
(d) Both trading countries.

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

Short Answer Questions

1. Past and current definitions of liberalism are the same with respect to ______.

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

3. What does Friedman believe will markets do over time to monopolies?

4. A major point for Friedman is that politics and economics are not ______.

5. What major event does Friedman strongly believe was a result of the government mishandling the money supply?

(see the answer key)

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