ANSWERS TO MATCHING II A. Frederich Hayek and Ludwig von Mises B. Milton Friedman C. Joseph Schumpeter D. Third World E. 'agreement' between Truman's Treasury and the Federal Reserve as to Fed purchase of T bills, policy toward money supply, etc. F. estimation that in the not too distant future, all the poor will be single mothers and their dependents G. the resoucres of the earth, including the fixed amount of capital, will be inadequate to support the earth's increasing population. H. argued that from the 'original positon' behind the 'veil of ignorance,' we would all choose a completely equal wealth distribution, and that government is the vehicle for effecting it. I. a good argument for protectionist policies in the US in the pre Civil War period. J. such measures as red tape that effect protection. K. argued that government programs intended to fight poverty have increased it, if not caused it. L. a good argument for maintaining, even through protection, a strong steel industry or capacity to build bombes, etc. M. any of a number of proposed governmental policies to block competition from foreign firms. N. the relative values of the currencies of different countries vis a vis one another -- the present standard of such values is largely pegged to the US dollar. O. was declining until the government's war on poverty, since which it has increased. P. suggests that there is some positive relationship between the federal budget deficit and the trade deficit. Q. period of time between when a policy is implemented and when its impact can be seen. R. bank deposits 'create' money. S. the system of fixed exchange rates sat up after WWII and which were maintained until the middle seventies, since which time we have had a free, market based system of exchange rates. T. argues for decreased governmental regulation and lower tax rates to stimulate economic production. U. measures such as currency devaluation, free trade without governmental invention, and population control measures, and sometimes even wealth and property redistribution, as a prerequisite for IMF loans to countries. V. a large group of people systematically excluded from the economic advances of an economy, argued by some to result from government poverty programs which redistribute wealth and decapitate the profit/social surplus fuel of development, and by subsidizing poverty, actually increases it. W. international banking institution under UN auspices which functions much as a form of 'overdraft' protection for countries in regard to their currency exchange matters, extending loans to them to meet needs to promote trade, and which is under control of the largest economic members, the G-7 nations. X. purports to measure the deposit and money creation expansion impact. Y. holds that the business cycle follows fluctuations in the money supply. Z. indicate what the economy will be doing six months ahead; such as housing starts and wholesale purchases. AA. an international agreement to set reduced barriers to trade among nations. BB. increased output per unit of input; largely a function of techological innovation. CC. one of the most harmful of the conditionalities imposed by the IMF, it suggests that undeveloped nations should receive loans to acquire only to match their level of technological development, thus consigning them to subsistence, and to be unable to pay back their loans or the interest on them. DD. originally intended to be an effort to increase trade among the US, Mexico, and Canada by reducing trade barriers among them, the enabling measures of the actual plan put the economies of these countries even more under control of international planners. Return to Answer Sheet of Exam