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

Multiple Choice Questions

1. The Food and Drug Administration performs all of the following functions but:
(a) advertising requirements
(b) testing new drugs
(c) labeling requirements
(d) writing prescriptions

2. Friedman believes that the income tax system is:
(a) based on ability to pay
(b) in need of reform
(c) equitable
(d) needs more loopholes

3. Regarding public and private colleges and universities, the number of students who complete the undergraduate degrees is:
(a) the same at public and private institutions
(b) only slightly higher at pubhlic institutions
(c) higher at public institutions
(d) higher at private institutions

4. The minimum wage causes:
(a) social unrest
(b) unemployment
(c) higher employment levels
(d) no effect on employment levels

5. Most of the funding for public education is provided by the:
(a) state
(b) federal government
(c) city
(d) county

6. Most Western nations have experienced:
(a) no change in the size of national government
(b) laws limited the growth of government
(c) growth of national government
(d) decrease in the growth of government

7. Attendance at school became mandatory in all states in:
(a) 1923
(b) 1918
(c) 1875
(d) 1900

8. In what ways does competition protect the consumer?
(a) through the honesty of sellers
(b) by advertising
(c) by the information provided with the product
(d) consumers will not continually buy shoddy products

9. Which of the following is not a method of unions securing higher wages?
(a) restricting jobs
(b) the free market
(c) collusion with the employer
(d) enforcing a higher wage

10. The trucking industry was brought under ICC jurisdiction in:
(a) 1952
(b) 1943
(c) 1935
(d) 1948

11. Which of the following is not a way of rationing high paying jobs:
(a) corruption
(b) featherbedding
(c) hiring anyone
(d) nepotism

12. In Virginia in the 1600s, what functioned as money?
(a) tobacco
(b) beads
(c) gold
(d) wampum

13. Gresham's Law says that:
(a) good money drives out bad
(b) good money decreases
(c) good money multiplies
(d) bad money drives out good

14. The reason given for regulation of industry is to:
(a) protect the industry from the effects of competition
(b) stabilize the industry
(c) protect the consumer
(d) force higher prices

15. Inflation results when:
(a) there is no relation between output level and money supply
(b) the money supply increases more rapidly than the level of output
(c) the money supply increases less rapidly than the level of output
(d) the money supply and the output level increase at the same rate

Short Answer Questions

1. One of the big complaints of parents is that they:

2. The union does all but the following for its members:

3. Objections to the school voucher plan include all but the following:

4. What does Friedman call one of the most successful labor unions in history?

5. All but the following have resulted from centralization in schooling:

(see the answer keys)

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