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This quiz consists of 5 multiple choice and 5 short answer questions through End of Book 3 & Book 4, Chapter 1.

Multiple Choice Questions

1. What is the sole end and purpose both of the fixed and circulating capitals?
(a) To maintain and augment the stock which may be sold for profit.
(b) To maintain and augment the stock which may be used to expand the business.
(c) To maintain and augment the stock which may be traded for needed goods.
(d) To maintain and augment the stock which may be reserved for immediate consumption.

2. What was the common rate of interest on borrowing through the greater part of Europe before the discovery of the West Indies?
(a) 9%.
(b) 10%.
(c) 11%.
(d) 12%.

3. What is the common instrument of commerce and exchanges in Virginia?
(a) Sugar.
(b) Salt.
(c) Tobacco.
(d) Shells.

4. What is a consequence of replacing gold money with paper money?
(a) It costs less both to erect and to maintain.
(b) It allows for more buying power.
(c) It promotes a new industry.
(d) It allows for increased wages.

5. What does a man expect when he employs his stock as capital?
(a) Wages.
(b) Reserve.
(c) Profit.
(d) Labor.

Short Answer Questions

1. How important is it that the merchant whose capital exports the surplus produce of any society be a native or a foreigner?

2. Originally, what did sailors fear?

3. What is the whole annual produce of the land and labor of every country used for?

4. What three ways do we obtain from one another the greater part of those mutual good offices which we stand in need of?

5. What is a borrower who uses his borrowed stock for immediate consumption?

(see the answer key)

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