Another catch in my trawling for exams, we have below two undergraduate comprehensive examinations from Princeton (1929 and 1932). These exams were selected and published in a supplement to the Bulletin of the Association of American Colleges dedicated to the subject of comprehensive exams. The style of the questions is rather different from those seen for Harvard from 1931 that were transcribed for the previous post.
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Senior Comprehensive Examination
Princeton University, 1932
Part I
Use a separate book for each question
I
(20%)
- Contrasting the England of 1700 with the England of the Middle Ages, R. H. Tawney states: ” Opinion ceased to regard social institutions and economic activity as amenable, like personal conduct to moral criteria.”
How far was this true (1) of price; (2) of the money reward for human labor? Give the reasons. - Compare Henry George’s theory of rent with Ricardo’s theory of rent.
II
(40%)
- What was the Marxian theory of “surplus value”? Discuss the present price and wages policy in Russia in the light of the Marxian theory.
- “Socialization will proceed, step by step, from one industry to another, according as circumstances in each country may permit. Objectionable as private profit-making enterprise is to Socialists, they will refrain from destroying it in any industry until they are in a position to replace it by a more efficient form of organization.” (From a resolution of the Labor and Socialist International.)
What is the “more efficient form of organization” proposed for the “nationalized industries,” as illustrated in the Webb Constitution for the Socialist Commonwealth of Great Britain? Would it be more efficient than “private profit-making enterprise” in these industries? Give your reasons.
III
(40%)
Answer one of the three following questions: A, B, or C.
A
Discuss the Interstate Commerce Commission in its present status as a regulator of interstate commerce. Is it lacking any powers which it should possess? Should it be deprived of any powers that it now has? Are there any powers it should retain which could be made more effective by legislation? Give reasons for your answers.
B
At the time of the Napoleonic Wars the following statement was made as to the ability of Great Britain to make remittances to the continent to support her armies and subsidize her allies:
“A favorable balance of trade is a very probable consequence of large drafts on Government for foreign expenditure; an augmentation of exports, and a diminution of imports, being promoted and even enforced by the means of such drafts.”
A few weeks ago, in a discussion of the payments of inter-allied debts, it was stated:
“The essential fact about war debt payments is that they are foreign payments. Many people seem to think that the French Government may tax its citizens, deposit the money in the Bank of France, and then either draw a check upon the Bank of France to pay the United States on war debts, or use the same money for armament expenditures. The essential difference is that a check drawn in francs by the French Government upon the Bank of France to the credit of the American Treasury is of no value to us until it is transferred into dollars.”
On the basis of these statements, discuss critically the topic, “Divergent Views on the Payment of International Obligations,” laying particular emphasis on the economic principles which are involved. Where possible, use historical illustrations in your discussion.
C
A certain industrial corporation has outstanding common stock of par value of $10,000,000; also a first mortgage bond issue, amply secured by the plant, of $2,000,000.
Below is a list of five possible methods of voluntarily revising the capital structure of this company.
- The issuance of convertible bonds,
- The declaration of a stock dividend,
- The declaration of a privileged stock subscription,
- The purchase of the company’s own stock in the open market,
- The formal reduction of the corporation’s capital by amendment of the certificate of incorporation.
Discuss thoughtfully four of these five methods.
While it is not desirable to lay down any rigid plan to be adhered to in discussing all of these methods, your answer should explain (1) what is involved in the use of the method in question, (2) the objective or objectives ordinarily sought to be attained by its use, (3) what conditions other than those stated in the first paragraph should prevail in order to justify the use of the method, and (4) any special disadvantage which might be suffered.
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Senior Comprehensive Examination
Princeton University, 1929
Examination in Special Field I
I
Case A
During the latter part of the period of inconvertible paper currency in this country (1862-1879) trade dollars (a silver coin somewhat heavier than the standard silver dollar and possessing at that time the right of free coinage) began to appear in circulation alongside the greenbacks, although the trade dollar was intended for use only in foreign trade.
Case B
In Russia, the chervonetz, a paper monetary unit issued in 1923, kept at a high value by relative limitation of quantity and backed by a considerable gold reserve, quickly drove the Soviet paper rouble, an enormously depreciated paper monetary unit, out of circulation.
Case C
In Germany, in 1923, foreign gold standard currencies appeared in considerable volume in ordinary commercial transactions, which up to that time had for years been carried on almost entirely with highly depreciated paper marks.
In all these cases “bad” money not only did not drive out good but the reverse was more nearly true. Explain each case and state Gresham’s Law so as to make it universally applicable.
II
Suppose that the United States in 1893 had abandoned the gold standard, taken from gold the legal tender quality and made all paper currency redeemable in silver dollars which were no longer freely coined.
(a) What would have been the upper and lower limits on the exchange rates of the dollar against gold standard currencies?
(b) What influences would have affected the gold value of the dollar?
(c) How, if at all, would the gold price of silver have been affected?
(d) Could the rise in prices, which took place after 1896, have been prevented under the monetary system outlined above? Reasons.
III
Compare the check and deposit system of banking, such as prevails in Anglo-Saxon countries, with the French system where checks are little used and practically the whole of the circulating medium is issued by the Bank of France which shares its profits with the government of the republic.
Your answer should attempt to assess, from the point of view of the general interest, the relative virtues and vices of the two types of banking, showing specifically and precisely in what manner advantages or disadvantages accrue under the one or the other system.
IV
Assume that in any given country:
(a) central bank reserves are very high;
(b) exports are increasing relative to imports;
(c) stock speculation has been and continues rampant and stock prices have risen greatly;
(d) commodity prices are stable.
What policy do you think the central bank should pursue, and why?
V
Spain is now on an inconvertible paper monetary standard. Suppose that political disturbances lead to a sharp decline in confidence with regard to Spain’s economic prospects, that present foreign lenders to Spain seek to withdraw their capital and that further loans are refused. Trace through the resulting movement of exchange rates the probable course of trade and industry in Spain up to the point of restoration of a stable economic equilibrium. Assume no further inflation of the Spanish currency.
VI
- Give a brief description of the Dawes Plan of reparations payments, criticizing adversely where such criticism seems to you to be warranted.
- Compare the economic effects on both paying and receiving countries of reparations in cash and reparations in kind.
Source: Edward S. Jones. Comprehensive Examinations in the Social Sciences, Supplement to the December, 1933 Bulletin of the Association of American Colleges, pp. 38-41.
Image Source:John E. Sheridan, Princeton Poster, c. 1901 . Library of Congress Prints and Photographs Division Washington, D.C. 20540 USA.