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This quiz consists of 5 multiple choice and 5 short answer questions through Chapter 3, The Control of Money.

Multiple Choice Questions

1. What major event does Friedman strongly believe was a result of the government mishandling the money supply?
(a) None of the answers is correct.
(b) World War I.
(c) The Great Depression.
(d) Prohibition.

2. In the market described by Friedman, exchanges between households are ______.
(a) Unwilling.
(b) Voluntary.
(c) Coerced.
(d) Obligatory.

3. What does Friedman use as an example of a use of government where individuals cannot consume individual amounts?
(a) Postal service.
(b) Healthcare.
(c) Education.
(d) National defense.

4. Friedman states that government should be ______.
(a) Streamlined.
(b) Incorporated.
(c) Consolidated.
(d) Decentralized.

5. What does Friedman believe is an appropriate rate of increase for the Federal Reserve?
(a) None. That is not a goal of the Federal Reserve.
(b) 1%-3%.
(c) 3%-5%.
(d) 5%-7%.

Short Answer Questions

1. For Friedman, what is an all-embracing ethic?

2. In Chapter 3, what does Friedman provide a history of?

3. What does Friedman believe needs protection in order for the freedom of the market to arise?

4. Friedman believes that free markets are not sufficient for political freedom since many countries demonstrate the possibility of ______.

5. What is the basic problem of social life for Friedman?

(see the answer key)

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