Here are the answers with discussion for this Weekend’s Quiz. The information provided should help you work out why you missed a question or three! If you haven’t already done the Quiz from yesterday then have a go at it before you read the answers. I hope this helps you develop an understanding of Modern…
Welcome to The Weekend Quiz. The quiz tests whether you have been paying attention or not to the blog posts that I post. See how you go with the following questions. Your results are only known to you and no records are retained.
- 1. Over a given economic cycle (peak to peak), if a nation's external sector is, on average, balanced and the government gap between its tax revenue and spending is, on average, equal to 1 per cent of GDP, then the private domestic sector's spending-income balance will, on average, be in:
- Deficit of 1 per cent of GDP
- Surplus of 1 per cent of GDP
- 2. If the government uses its fiscal policy instruments to maintain trend real GDP growth it will also ensure full employment is sustained.
- 3. If the external sector is accumulating financial claims on the local economy (that is, providing foreign savings to the domestic economy) and the GDP growth rate is lower than the real interest rate, then the private domestic sector and the government sector can run surpluses without damaging employment growth.
Sorry, quiz 493 is now closed.
You can find the answers and discussion here