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This quiz consists of 5 multiple choice and 5 short answer questions through Section IV. A Tale of Three Banks, Chapters 16-19 The Creature Comes to America; A Den of Vipers; Loaves and Fishes, and Civil War; Greenbacks and Other Crimes.

Multiple Choice Questions

1. What culture was the first to create a currency system based on gold and silver?
(a) The ancient Greeks came up with the idea to make coins out of gold and silver.
(b) The British came up with the idea to make coins out of gold and silver.
(c) The ancient Romans came up with the idea to make coins out of gold and silver.
(d) Alexander the Great came up with the idea to make coins out of gold and silver.

2. How is the Federal Reserve System reviewed in general?
(a) The Federal Reserve System had become the lender of last resort.
(b) The Federal Reserve System had become known to have the strictest lending standards.
(c) The Federal Reserve System had become the economic leader of the country.
(d) The Federal Reserve System had become the nation's first source of lending.

3. What resulted when paper money was not backed with gold or silver?
(a) Money not backed by precious metal led to higher deficits.
(b) Money not backed by precious metal led to deflation and political upheaval.
(c) Money not backed by precious metal led to booming economies and political stability.
(d) Money not backed by precious metal led to inflation and political upheaval.

4. What do many people feel was the real reason behind the establishment of the Federal Reserve?
(a) Many feel that the real reason for creating the Federal Reserve was to keep the middle class from failing.
(b) Many feel that the real reason for creating the Federal Reserve was to keep poor people from turning to crime.
(c) Many feel that the real reason for creating the Federal Reserve was to keep the rich from becoming too powerful.
(d) Many feel that the real reason for creating the Federal Reserve was to keep rich people in power.

5. What country was formed after the second Russian revolution?
(a) The country of Georgia was established after the second Russian revolution.
(b) The USSR developed after the second Russian revolution.
(c) New Poland was formed after the second Russian revolution.
(d) Kurdistan was formed after the Russian revolution.

Short Answer Questions

1. What is a fractional money system?

2. Early banks were supported by what monetary system?

3. What was the main argument in favor of nationalizing banks?

4. What caused the economy to get into such a state that the government was compelled to bail out banks?

5. When did governmental typically find it necessary to print more paper money?

(see the answer key)

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