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

Multiple Choice Questions

1. What does Friedman believe makes registration easier?
(a) Recognition.
(b) Taxation.
(c) Representation.
(d) Elections.

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

3. Which type of monopoly does Friedman believe is least bad?
(a) Private monopoly.
(b) Government monopoly.
(c) Government regulation.
(d) Labor monopoly.

4. At the time of the book's publication, there was a tendency to regard government intervention as ______.
(a) Necessary.
(b) Desirable.
(c) Detrimental.
(d) Harmful.

5. What has capitalism done for discrimination according to Friedman?
(a) Abolished it.
(b) Widened.
(c) Reduced it.
(d) Increased it.

6. According to Friedman, the essence of a competitive market is its ______ character.
(a) Impersonal.
(b) Public.
(c) Trustworthy.
(d) Private.

7. Forming a list of who engages in what is known as ______.
(a) Organizing.
(b) Licensing.
(c) Listing.
(d) Registration.

8. According to Friedman, what is the goal of government intervention regarding the distribution of income?
(a) Income equality.
(b) Taxation.
(c) Job creation.
(d) Social welfare.

9. Who does Friedman believe is most critical of capitalism?
(a) Democrats.
(b) Marxists.
(c) Communists.
(d) Socialists.

10. What is one argument Friedman gives for public housing?
(a) The neighborhood effect.
(b) The paternalism effect.
(c) The law of demand effect.
(d) The law of supply effect.

11. Friedman gives the following examples of the negative effects of government intervention except ______.
(a) Farm subsidies.
(b) Religious freedom acts.
(c) Regulation of the railroads.
(d) Housing programs.

12. What effect has Friedman observed that public housing has had on juvenile delinquency?
(a) Reduced it.
(b) Maintained it.
(c) Spread it out.
(d) Increased it.

13. Friedman gives examples of successful government intervention except ______.
(a) Sherman antitrust laws.
(b) School system.
(c) The income tax.
(d) Magnificent dams.

14. For Friedman, what is the main argument for licensure?
(a) Paternalism.
(b) Racism.
(c) Maternalism.
(d) Materialism.

15. What two professions does Friedman compare to support his claim on the harm it does when people are unable to find mutually acceptable contracts?
(a) Teacher and professor.
(b) Baseball player and basketball player.
(c) Blues singer and opera singer.
(d) Doctor and priest.

Short Answer Questions

1. What industry does Friedman use to explain his views on monopoly in labor?

2. Friedman claims there is no connection between equal treatment and what?

3. What is one disadvantage Friedman describes of programs to alleviate poverty?

4. According to Friedman, who benefits from licensure?

5. Three levels of control are licensing, registration, and ______.

(see the answer keys)

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