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

Multiple Choice Questions

1. What is the actual price at which any commodity is commonly sold called?
(a) The derived price.
(b) The prime price.
(c) The asking price.
(d) The market price.

2. In the rude ages of society, what was the common instrument of commerce?
(a) Cattle.
(b) Food stuffs.
(c) Labor.
(d) Textiles.

3. What was the original form of the metals used for commerce?
(a) Nuggets.
(b) Coins.
(c) Lumps.
(d) Bars.

4. What is it called when gold purchases goods in one foreign country in order to supply the consumption of another?
(a) Foreign purchase trade.
(b) Consumption trade.
(c) Domestic revenue trade.
(d) Carrying trade.

5. According to Homer, how much did the armor of Diomede cost?
(a) Eight oxen.
(b) Eleven oxen.
(c) Ten oxen.
(d) Nine oxen.

6. What does the division of labor do for individual workmen?
(a) It reduces every man's job to one simple operation.
(b) It gives each man more work to do.
(c) It enables each man to work fewer hours.
(d) It teaches each man a new skill.

7. What becomes the common instrument of commerce when barter ceases?
(a) Gold.
(b) Gem stones.
(c) Money.
(d) Silver.

8. What kind of demand brings a commodity to market?
(a) An effectual demand.
(b) A natural demand.
(c) A proportionate demand.
(d) An absolute demand.

9. What was the common instrument of commerce among the ancient Romans?
(a) Iron.
(b) Copper.
(c) Gold.
(d) Silver.

10. When was the Bank of England incorporated?
(a) The 27th of July, 1695.
(b) The 27th of July, 1693.
(c) The 27th of July, 1696.
(d) The 27th of July, 1694.

11. What is capital?
(a) Stock from which revenue is expected.
(b) Stock which a man consumes.
(c) Stock reserved for future needs.
(d) Stock traded for other goods.

12. What kind of capital is employed in the improvement of land and in the purchase of useful machines and instruments of trade?
(a) Fixed capital.
(b) Circulating capital.
(c) Instrumental capital.
(d) Improving capital.

13. The ordinary or average rates of wages, profit, and rent may also be called what?
(a) The common rates.
(b) The natural rates.
(c) The commodity rates.
(d) The derived rates.

14. What happens in every country that employs an increase in stock?
(a) The same quantity of industry produces a lesser quantity of work.
(b) The same quantity of industry produces a greater quantity of work.
(c) The greater quantity of industry produces a greater quantity of work.
(d) The lesser quantity of industry produces produces a greater quantity of work.

15. How many times more goods on a broad-wheeled wagon can be carried from London to Edinburgh by water-carriage in the same amount of time?
(a) 50.
(b) 40.
(c) 45.
(d) 55.

Short Answer Questions

1. In every occupation, what is the general proportion between circulating and fixed capital?

2. What is the sole end and purpose both of the fixed and circulating capitals?

3. How did the idea of division of labor come about?

4. What kind of capital is employed in raising, manufacturing, or purchasing goods, and selling them again with a profit?

5. What do princes and sovereign states frequently do with their coinage?

(see the answer keys)

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