2. Originally, in the early days of the country, equality meant:
(a) the basis for welfare legislation
(b) the end of slavery
(c) equality before God
(d) equality in all aspects of life

3. The economist that changed the way of economic thinking regarding depressions was:
(a) David Ricardo
(b) Adam Smith
(c) Milton Friedman
(d) John Maynard Keynes

4. What words did Thomas Jefferson write?
(a) there is no such thing as equality
(b) all men are created equal
(c) equality is not important
(d) equality is not a part of freedom

5. A market failure occurs when:
(a) an action or transaction affects third parties
(b) the production of a good is discontinued
(c) a producer goes bankrupt
(d) a producer finds there is no demand for his good

Short Answer Questions

1. Black Thursday, October 24, 1929, refers to the:

2. What functions as the central bank for the United States?

3. Which of the following is not a public assistance program?

4. A change in prices affects all but the following:

5. Interested sophistry refers to:

Short Essay Questions

1. England has a successful National Health Service that many people think the United States should have. What are the problems with the British program?

2. What is a restriction of payments?

3. Which two New Deal programs were declared unconstitutional?

4. What are the basics for the production and consumption of goods and services?

5. What good does Friedman use as an example of voluntary exchange?

6. Why weren't the New Deal programs carried to completion?

7. What did Thomas Jefferson mean when he wrote of equality?

8. What is the concept of the invisible hand?

9. What is an exchange rate?

10. What is the major federal welfare program in the Untied States and what are its components?

(see the answer keys)

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