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

Multiple Choice Questions

1. What is the inherent nature of stock and credit?
(a) They are unstable but renewable.
(b) They are unstable and perishable.
(c) They are stable and permanent.
(d) They are stable and renewable.

2. What has increased in countries where interest on borrowed money has been prohibited by law?
(a) Capital is stagnant.
(b) Industry does not grow.
(c) Money is borrowed from other countries.
(d) Usury has increased.

3. What does the proportion between capital and revenue regulate?
(a) The proportion between production and wages.
(b) The proportion between labor and manufacturing.
(c) The proportion between industry and idleness.
(d) The proportion between capital and money.

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

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

6. When a government has borrowed a great deal of money, what is the justification for imposing new taxes?
(a) To refill the emptied treasury.
(b) To pay the interest on the borrowed money.
(c) To pay back the borrowed money.
(d) To run a government which has become more expensive.

7. What is the third part of capital use in every growing society?
(a) Foreign commerce.
(b) Inland commerce.
(c) Manufacturers.
(d) Agriculture.

8. In 1715, what was the name of the accumulated taxes which had been mortgaged for paying the bank annuity?
(a) The Accumulated Fund.
(b) The Augmented Fund.
(c) The Differential Fund.
(d) The Aggregate Fund.

9. How does annual consumption compare to annual spending?
(a) More is spent.
(b) More is consumed.
(c) They are nearly the same.
(d) There is no correlation.

10. Who besides productive and unproductive laborers are all equally maintained by the annual produce of the land and labor of the country?
(a) Those who do not labor at all.
(b) Those who labor only for themselves.
(c) Those who labor in another country.
(d) Those who are not citizens of the country.

11. How do most men choose to employ their capitals?
(a) Manufactures.
(b) Improvement of land.
(c) Agriculture.
(d) Foreign trade.

12. What are the two kinds of labor?
(a) Professional and unskilled.
(b) Wage earning and charitable.
(c) Manual and mental.
(d) Productive and unproductive.

13. What is the principal cause of the rapid progress of the American colonies?
(a) Nearly their entire capitals are employed in agriculture.
(b) Nearly their entire capitals are employed in commerce.
(c) Nearly their entire capitals are employed in land.
(d) Nearly their entire capitals are employed in settlements.

14. What comes before convenience?
(a) Opulence.
(b) Maintenance.
(c) Subsistence.
(d) Luxury.

15. During the sixteenth century, who claimed all of America as its own?
(a) Portugal.
(b) Holland.
(c) Great Britain.
(d) Spain.

Short Answer Questions

1. What bill was published by Alexander III in the 12th century?

2. Why isn't the wool of southern Scotland manufactured there?

3. Sugar was originally an enumerated commodity which could be exported only to which country?

4. What happens when the quantity of silver increases?

5. Which profession is not an example of an artificer?

(see the answer keys)

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