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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 interferes with the transmittal of information by prices?
(a) Governmental control of prices
(b) actions of sellers
(c) actions of buyers
(d) actions of manufacturers

2. An economic contraction means all but the following:
(a) decreased output
(b) increased output
(c) lower levels of income
(d) unemployment

3. Open Market Operations refers to:
(a) the purchase and sale of government bonds
(b) flooding the market with junk bonds
(c) stock market operations
(d) a department store sale

4. Some people support tariffs because they think that tariffs:
(a) create jobs
(b) offer protection for consumer
(c) result in increased efficiency
(d) lower prices

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

Short Answer Questions

1. What is a good source of information on prices and markets?

2. Government interferes with the price system by:

3. The term human capital refers to the:

4. Adam Smith says that voluntary exchange will not take place unless:

5. International trade theory is based on:

(see the answer key)

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