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This quiz consists of 5 multiple choice and 5 short answer questions through Chapter 11, Social Welfare Measures.

Multiple Choice Questions

1. What is the relationship between capitalism and the fraction of income paid for capital in countries?
(a) Perpendicular.
(b) Correlational.
(c) Inverse.
(d) Direct.

2. What does Friedman believe makes registration easier?
(a) Representation.
(b) Recognition.
(c) Taxation.
(d) Elections.

3. Friedman points out one idea that is often forgotten is that political and economic institutions have been ______.
(a) Suppressed.
(b) Free.
(c) Unfree.
(d) Autonomic.

4. What is one method that governments have used to alter the distribution of income?
(a) Real estate law.
(b) Selling bonds.
(c) Income taxation.
(d) Social welfare.

5. Friedman states that the problem with teacher salaries is not that they are too low, but that they are ______.
(a) Not inclusive of benefits.
(b) The same regardless of quality.
(c) Linked to the amount of education the teacher has.
(d) Computed based on seniority.

Short Answer Questions

1. What is one example of a negative externality?

2. What does Friedman advocate the abolition of in Chapter 10, The Distribution of Income?

3. Labor unions are referred to as ______.

4. What major event does Friedman strongly believe was a result of the government mishandling the money supply?

5. What example does Friedman use to demonstrate his views on employment practices?

(see the answer key)

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