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

Multiple Choice Questions

1. What kind of commodity must be sold quickly?
(a) Those no longer wanted.
(b) Those which will not endure.
(c) Those in short supply.
(d) Those with abundance of supply.

2. What kind of business does not lend itself to many subdivisions of labor?
(a) Foundry.
(b) Textile manufacturing.
(c) Ship building.
(d) Agriculture.

3. What was the original form of the metals used for commerce?
(a) Bars.
(b) Nuggets.
(c) Coins.
(d) Lumps.

4. In all countries, what do men prefer in exchange for commodities?
(a) Like goods.
(b) Labor.
(c) Precious metals.
(d) Gem stones.

5. How did the idea of division of labor come about?
(a) It was a consequence of the applied study of manufacturing.
(b) It was an accident which resulted in positive change.
(c) It was the propensity of human nature to truck, barter, and exchange one thing for another.
(d) It was an experiment which owners found to be advantageous.

6. What happens in every country that employs an increase in stock?
(a) The same quantity of industry produces a lesser quantity of work.
(b) The lesser quantity of industry produces produces a greater quantity of work.
(c) The greater quantity of industry produces a greater quantity of work.
(d) The same quantity of industry produces a greater quantity of work.

7. What regulates the price of every particular commodity?
(a) Profit and wages.
(b) Labor and wages.
(c) Labor and profit.
(d) Supply and demand.

8. What is another name for paper money?
(a) Commerce notes.
(b) Circulating notes.
(c) Promissory notes.
(d) Debtors' notes.

9. What does the author consider to be a wasteful use of gold?
(a) Picture frames.
(b) Flatware.
(c) Gilding and plating.
(d) Goblets.

10. How long would it take for a broad-wheeled wagon, attended by two men, and drawn by eight horses, to carry four tons of goods between London and Edinburgh?
(a) Seven weeks.
(b) Six weeks.
(c) Five weeks.
(d) Four weeks.

11. In what country is the Ganges River?
(a) Egypt.
(b) Italy.
(c) India.
(d) Bengal.

12. Why are the silks of France better and cheaper than those of England?
(a) Because silk manufacturing is not popular in England.
(b) Because France has an extreme surplus of silk manufacturers.
(c) Because there is little demand for English silk.
(d) Because silk manufacturing is not as well suited to the climate of England as it is to that of France.

13. Why are new machines more likely to be invented under division of labor?
(a) New machines are required when labor has been divided.
(b) Men have more time to experiment with various options and potential improvements.
(c) Division of labor promotes speculation and new ideas to be tried.
(d) Men are more likely to discover more efficient methods of production when their entire focus is directed towards a single step of the process.

14. What is the actual price at which any commodity is commonly sold called?
(a) The derived price.
(b) The market price.
(c) The prime price.
(d) The asking price.

15. What is the common instrument of commerce and exchanges in some parts of the coast of India?
(a) Tobacco.
(b) Shells.
(c) Salt.
(d) Sugar.

Short Answer Questions

1. Which is not a reason for the increase of the quantity of work under division of labor?

2. How are a philosopher and a street porter the same?

3. What is capital?

4. What happens when the demand of a commodity is larger than the supply?

5. What is the sole end and purpose both of the fixed and circulating capitals?

(see the answer keys)

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