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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. What action did the Fed take after England abandoned the gold standard?
(a) suspended open market operations
(b) lowered the discount rate
(c) began hoarding gold
(d) raised the discount rate

2. An exchange rate is the:
(a) bill of lading
(b) interest rate in the foreign country
(c) price of one currency in terms of another currency
(d) the way trade barriers are established

3. The national security argument for protection states that:
(a) protection promotes national welfare
(b) all industries should be protected
(c) protection is not in the best national interest
(d) industries vital to national defense should be given protection

4. What functions as the central bank for the United States?
(a) the Federal Reserve System
(b) the Bank of England
(c) the Bank of the United States
(d) Chase Bank

5. The term human capital refers to the:
(a) personal productive capacity of an individual
(b) output produced by a fasting
(c) kinds of inputs the worker uses
(d) machinery in the factory

Short Answer Questions

1. A change in prices affects all but the following:

2. The distribution of income is determined by all but the following:

3. Prices function to transmit information to all but:

4. Black Thursday, October 24, 1929, refers to the:

5. The Federal Reserve Act was legislated in:

(see the answer key)

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