This quiz consists of 5 multiple choice and 5 short answer questions through Section I. What Creature Is This? Chapter 2 The Name of the Game Is Bailout.

Multiple Choice Questions

1. Why has bank fraud never been eliminated?
(a) Financial experts were taught that the way banking worked in the US was the only way it could work, and so the fraud kept on going.
(b) The Federal Reserve tried to institute European standards which led to the perpetuation of fraud.
(c) The Federal Reserve was influenced by lobbyists who advocated fraudulent regulations.
(d) The Federal Reserve was controlled by outside political interests that fostered fraud.

2. The banking system before the Federal Reserve System allowed banks to lend out what percentage of money against one percent in deposits.
(a) The banking system before the Federal Reserve System allowed banks to lend out more money than they held in deposits, up to sixty percent loaned out with only one percent in deposits.
(b) The banking system before the Federal Reserve System allowed banks to lend out more money than they held in deposits, up to twenty percent loaned out with only one percent in deposits.
(c) The banking system before the Federal Reserve System allowed banks to lend out more money than they held in deposits, up to fithy percent loaned out with only one percent in deposits.
(d) The banking system before the Federal Reserve System allowed banks to lend out more money than they held in deposits, up to ninety-nine percent loaned out with only one percent in deposits.

3. What did the Federal Reserve System help banks to do?
(a) The Federal Reserve helped banks by making special laws for them.
(b) The Federal Reserve helped banks to stay in operation.
(c) The Federal Reserve helped banks keep a healthy cash flow.
(d) The Federal Reserve helped banks keep individuals, businesses and entire countries perpetually in debt and working mostly for the banks.

4. How did unemployment impact the economic problems?
(a) High employment distracted people from looking for homes.
(b) High unemployment compounded this problem, forcing people into foreclosures and drying up the housing market.
(c) High employment made more homes available for sale.
(d) The Federal government was distracted from economic problems and focused their attention on the unemployed.

5. In what year was the concept of the Federal Reserve first developed?
(a) The concept of the Federal Reserve was developed in 1920.
(b) The concept of the Federal Reserve was developed in 1910?
(c) The concept of the Federal Reserve was developed in 1966.
(d) The concept of the Federal Reserve was developed in 1952.