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This quiz consists of 5 multiple choice and 5 short answer questions through Chapter 4, International and Financial Trade Arrangements.

Multiple Choice Questions

1. Originally, liberalism fought for freedom of thought, free-markets, free trade, constitutionalism, representative government, and ______.
(a) Rights of the poor.
(b) The rule of law.
(c) Fair trade.
(d) A welfare state.

2. What is one example of a negative externality?
(a) Pollution.
(b) Private education.
(c) Lack of voting.
(d) Welfare.

3. Friedman states that government should be ______.
(a) Expanded.
(b) Held accountable.
(c) Destroyed.
(d) Limited.

4. What is the name of the system with the purpose of regulating monetary policy between leading countries?
(a) The Bretton Woods System.
(b) The World Bank System.
(c) The Gold Standard System.
(d) The International Monetary System.

5. According to Friedman, what is the Federal Reserve lacking?
(a) A Declaration of Independence of sorts.
(b) A Constitution of sorts.
(c) A Rosetta Stone of sorts.
(d) A Magna Carta of sorts.

Short Answer Questions

1. According to Friedman, what is a necessary condition for political freedom?

2. Friedman advocates that individuals should be able to buy and sell ______.

3. What term refers to the Federal Reserve's ability to produce more money than is deposited?

4. Friedman asserts that the Federal Reserve created the major contractions of the following years except______.

5. What does Friedman assert is an example of an appropriate task for government?

(see the answer key)

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