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This test consists of 15 multiple choice questions and 5 short answer questions.

Multiple Choice Questions

1. According to Friedman, it can be argued that private schools ______ class distinctions, and therefore need government intervention.
(a) Maintain.
(b) Exacerbate.
(c) Diminish.
(d) Increase.

2. Friedman states that government should be ______.
(a) Expanded.
(b) Held accountable.
(c) Destroyed.
(d) Limited.

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

4. According to Friedman, what conflicts with one another for men?
(a) Political ideology.
(b) Religious beliefs.
(c) Absolute freedom.
(d) Economic interests.

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

6. For Friedman, where is the best place for power to be held?
(a) In the states.
(b) In the local community.
(c) In the economic system.
(d) At the federal level.

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

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

9. In Friedman's time, what was illegal to buy or sell?
(a) Alcohol.
(b) Silver.
(c) Gold.
(d) Ethanol.

10. Friedman theorizes that in extreme cases where parents don't pay for schooling, the government could provide a ______.
(a) Discount.
(b) Pass.
(c) Subsidy.
(d) Allowance.

11. What does Friedman believe is an appropriate rate of increase for the Federal Reserve?
(a) None. That is not a goal of the Federal Reserve.
(b) 3%-5%.
(c) 5%-7%.
(d) 1%-3%.

12. Friedman advocates the end of ______.
(a) Exchange rates.
(b) Capitalism.
(c) The free market.
(d) Export quotas.

13. What does Friedman believe needs protection in order for the freedom of the market to arise?
(a) Contracts.
(b) Government.
(c) Religion.
(d) Citizens.

14. What term refers to the Federal Reserve's ability to produce more money than is deposited?
(a) Reserve ability production.
(b) Percent fulfillment banking.
(c) Fractional reserve banking.
(d) Overdraft protection.

15. According to Friedman, which of the following is the least bad?
(a) Public monopoly.
(b) Private monopoly.
(c) Private regulation.
(d) Public regulation.

Short Answer Questions

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

2. What is the term for currency not being traded for any amount of another currency?

3. According to Friedman, what is lost when foreign exchange is controlled by the government?

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

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

(see the answer keys)

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