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This quiz consists of 5 multiple choice and 5 short answer questions through Chapter 5, Fiscal Policy.

Multiple Choice Questions

1. How are decisions, for Friedman, made where unanimity is a costly way of making decisions?
(a) Majority rule.
(b) Decisions by committee.
(c) A system of checks and balances.
(d) Executive decision.

2. Friedman uses the example of selling ______ to demonstrate a true global economy.
(a) Corn.
(b) Oil.
(c) Wheat.
(d) Rice.

3. Which of the following cannot be justified by Friedman for government interventions?
(a) Public parks.
(b) Vouchers for education.
(c) Roads.
(d) Free speech.

4. What does Friedman say can government not duplicate?
(a) The creativity of the individual.
(b) An international monitoring system.
(c) The free market economic system.
(d) The power of local control.

5. In Friedman's eyes, individual activities correspond to game players as the framework of law corresponds to______.
(a) Leaders of the game.
(b) Players of the game.
(c) Rulers of the game.
(d) Finishers of the game.

Short Answer Questions

1. What is the name of the system with the purpose of regulating monetary policy between leading countries?

2. In Friedman's opinion, what will check government power?

3. In Friedman's opinion, what should individuals be allowed to do?

4. What does Friedman believe will become self-regulating?

5. In the market described by Friedman, exchanges between households are ______.

(see the answer key)

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