Yes, assuming terminal velocity is limited only by the friction caused by the movement of an object as the moon has no atmosphere to provide any friction.

Although it is unlikely that any object could reach terminal velocity on the moon as there is no realistic way for it to accelerate for long enough without crashing or exploiting the gravity of much larger objects.

Yes:

Terminal velocity is achieved by a falling body when the downward force (due to gravity) and any upward forces (such as air resistance) balance and there is no net acceleration. This is how parachutes work: they increase the downward-facing surface area of the falling body which in turn increases the effect of air resistance on that body, bringing the terminal velocity down to a speed which, when the ground is reached, is less literally terminal for the faller.

The moon has no atmosphere (or, at best, an incredibly tenuous one), so air resistance plays no discernible part in proceedings. Given sufficient time to reach it (the Moon's mass is lower than Earth's, therefore its gravitational pull is weaker and a falling body accelerates more slowly), a body would have a much higher terminal velocity than the same body would reach on the Earth.

Terminal velocity is the point at which, during freefall, the surface area of the downward-facing side of an object collides with enough air particles to balance out gravity so that a constant speed is reached. A favourite GCSE question uses a parachutist as an example - when the chute opens, the surface area increases, so terminal velocity would be a lot slower.

Another example of this would be if in a vertical race, one skydiver jumped in a "dive" position so he would be vertical, and another jumped in more of a "belly-flop" position. The dive position would move faster since there is less resistance.

On the Moon, however, there is not enough atmosphere to make any difference - on one of the later Apollo missions one of the astronauts dropped a feather and a hammer at the same time from the same height. They hit the ground at the same time since weight is immateriel to gravity, and there was no air resistance to slow the feather down.

So while gravity is only one sixth that of Earth on the Moon, if the objecty had enough time, it would probably reach speeds close to the speed of light before the air resistance can cancel out acceleration.