View a FREE sample

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

Multiple Choice Questions

1. What caused the Savings & Loan crisis of the 1980s?
(a) The Savings and Loan or S&L crisis of the 1980s happened because the government tried to insure the deposits, but the funds to do this were not adequate.
(b) The Savings and Loan or S&L crisis of the 1980s happened because the government tried to insure the deposits, but the funds were tied up in bank bailouts.
(c) The Savings and Loan or S&L crisis of the 1980s happened because the government tried to insure the deposits, but the funds were not made available by Congress.
(d) The Savings and Loan or S&L crisis of the 1980s happened because the government tried to insure the deposits but the president vetoed the legislation that was necessary to carry out the plan.

2. When were the International Monetary Fund and World Bank established?
(a) The World Bank and International Monetary Fund were established in 1910 at Jekyll Island.
(b) The World Bank and International Monetary Fund were established in 1929 when the Stock Market crashed.
(c) The World Bank and International Monetary Fund were established during the Cold War.
(d) In 1944, the Bretton Woods Conference took place, out of which came the International Monetary Fund or IMF and World Bank

3. What does the FDIC stand for?
(a) The FDIC stands for The Federal Deposit Insurance Corporation.
(b) The FDIC stands for The First Debt Institute of Connneticut.
(c) The FDIC stands for The First Depositor's Insurance Corporation.
(d) The FDIC stands for The Federal Debt Issuers Company.

4. The Federal Reserve System was designed to control what element of member banks?
(a) The Federal Reserve System was designed to control a bank's ability to make loans.
(b) The Federal Reserve System was designed to control how much reserve cash a bank can invest in its expansion.
(c) The Federal Reserve System was designed to control a bank's cash flow.
(d) The Federal Reserve System was designed to control how much reserve cash any member bank had to keep on hand.

5. After analysis, what was the real nature of the S&L system?
(a) The S&L system turned out to actually be operated by international interests.
(b) The S&L system turned out to actually be criminal.
(c) The S&L system turned out to actually be a cartel within a cartel.
(d) The S&L system turned out to actually be a scam.

6. How were the policies of FDR's administration a departure from capitalism?
(a) They abandoned the principles of the International Monetary Fund that were supposed to have worked with a purely capitalistic system.
(b) They abandoned Congressional banking regulations that were supposed to have worked with a purely capitalistic system.
(c) They abandoned the free market principles that were supposed to have worked with a purely capitalistic system.
(d) They abandoned standards of the Federal Reserve that were supposed to have worked with a purely capitalistic system.

7. What is the fundamental basis of capitalism?
(a) The main idea behind capitalism was investment and return on investment.
(b) The main idea behind capitalism was making investments in foreign interests.
(c) The main idea behind capitalism was making money and hoarding cash.
(d) The main idea behind capitalism was providing welfare to the less fortunate.

8. What was one of the strongest arguments in favor of bank regulation versus nationalization?
(a) An argument in favor of regulation was that, when properly administered, it had worked from the time of Franklin D. Roosevelt (President of the US from 1933 to 1945) to 1970.
(b) An argument in favor of regulation was that it would purge the system of fraud and abuse.
(c) An argument in favor of regulation was that the American people felt uncomfortable with nationalization.
(d) An argument in favor of regulation was that it would cause less unemployment.

9. What was the relationship between the World Bank and the IMF?
(a) The IMF and World Bank were controlled by the United Nations.
(b) The IMF and World Bank were associated with but not tied directly to the United Nations.
(c) The IMF and World Bank were a division of the United Nations.
(d) The IMF and World Bank were closely associated with the United Nations.

10. How did unemployment impact the economic problems?
(a) High unemployment compounded this problem, forcing people into foreclosures and drying up the housing market.
(b) High employment distracted people from looking for homes.
(c) The Federal government was distracted from economic problems and focused their attention on the unemployed.
(d) High employment made more homes available for sale.

11. What often occurs to a conspiracy theory when deceit is not used to strengthen their case?
(a) Without using deceit, conspiracy theories are proven on the arena of public opinion.
(b) Without using deceit, conspiracy theories are often debated in a higher education venue.
(c) Without using deceit, conspiracy theories usually stand on their own merit.
(d) Without the use of evasive tactics, the conspiracy theories often fall apart in their early stages of development.

12. What U.S. president removed the gold standard from the US dollar?
(a) President Nixon took the U.S. dollar off its gold backing so that dollars could not be redeemed for gold.
(b) President Lincoln took the U.S. dollar off its gold backing so that dollars could not be redeemed for gold.
(c) President Kennedy took the U.S. dollar off its gold backing so that dollars could not be redeemed for gold.
(d) President Wilson took the U.S. dollar off its gold backing so that dollars could not be redeemed for gold.

13. What historic reference is contained in this chapter?
(a) A history of the laws regulating the economy is contained in this chapter.
(b) A history of legislation regarding the Federal Reserve is contained in this section.
(c) A history of the Federal Reserve chairmain is contained in this section.
(d) A history of bailouts was outlined in this chapter, starting in 1970 with Penn Central Railroad.

14. In what year was the concept of the Federal Reserve first developed?
(a) The concept of the Federal Reserve was developed in 1952.
(b) The concept of the Federal Reserve was developed in 1966.
(c) The concept of the Federal Reserve was developed in 1920.
(d) The concept of the Federal Reserve was developed in 1910?

15. What organization ensures the nationalization of banks?
(a) As long as the Congressional Banking Committee existed, it would continue nationalizing banks and perhaps other industries as they fell into financial difficulties.
(b) As long as the International Monetary Fund existed, it would continue nationalizing banks and perhaps other industries as they fell into financial difficulties.
(c) As long as the FDIC existed, it would continue nationalizing banks and perhaps other industries as they fell into financial difficulties.
(d) As long as the Federal Reserve System existed, it would continue nationalizing banks and perhaps other industries as they fell into financial difficulties.

Short Answer Questions

1. How did poor regulation contribute to the Savings and Loan crisis of the 1980s?

2. What did the issuance of the first paper money lead to?

3. How did the development of paper money begin?

4. What impacted housing prices in the Midwest states?

5. Why did banks ask for interest-only payments?

(see the answer keys)

This section contains 1,455 words (approx. 5 pages at 300 words per page) View a FREE sample