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

Multiple Choice Questions

1. The Federal Reserve Act was legislated in:
(a) 1909
(b) 1929
(c) 1913
(d) 1908

2. The first head of the Federal Reserve System was:
(a) J.P. organ
(b) Alan Greenspan
(c) Alexander Hamilton
(d) Benjamin Strong

3. The infant industry argument for protection says a:
(a) all new industries should be given protection
(b) only certain industries should receive protection
(c) no industries should receive protection
(d) new industry should be given protection until it matures and can compete on its own

4. A run on a bank occurs when depositors:
(a) the bank refuses to make loans
(b) depositors refuse to deposit money
(c) depositors refuse loans
(d) try to withdraw their money in cash at the same time

5. The higher price of pencils results in all but the following:
(a) better worker condiciton for pencil prolduction workers
(b) fewer pencils
(c) higher wages for pencil production workers
(d) the firing of more workers to produce pencils

Short Answer Questions

1. Free trade takes place when:

2. Government interferes with the price system by:

3. Which bank failure precipitated the banking crisis of 1930?

4. The United States banking system is:

5. Which of the following is not one of Adam Smith's duties of government?

(see the answer key)

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