1. Mill's answer to number four is explained because of progress in:

A. Discovery of natural resources

B. Population and production

C. Improvements in the financial system

D. Government involvement in the economy

2. The solution to a commercial crisis is, according to Mill:

A. Lowering of interest rates and increases in available credit

B. Tax cuts

C. Increases in government spending

D. A restoration of confidence

3. According to Mill in the reading on Interest, interest pays the owner of capital for his:

A. Effort B. Frugality C. Abstinence D. Foresight

4. According to Mill, there is a _________ rate of interest, to which the market tends to return.

A. Superior B. Sufficient C. Natural D. Effective

5. According to Mill, the interest rate is created by the interaction of:

A. demand for and supply of loans

B. demand for and supply of money

C. demand for and supply of investment

D. government spending and private borrowing