The Weekend Quiz – September 3-4, 2022

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.

Quiz #699

  • 1. Assuming the expenditure multiplier is greater than 1, if the government increases its deficit they will have a greatest impact on aggregate demand if there are no offsetting monetary operations by the central bank (government bond sales) draining the excess reserves created.
    • False
    • True
  • 2. If the government achieves in reducing its fiscal deficit by say $10 billion, the net financial assets destroyed by this withdrawal could be replaced by the central bank engaging in a $10 billion quantitative easing program.
    • False
    • True
  • 3. . Which government deficit outcome is the most expansionary?
    • Structural deficit of 1 per cent of GDP.
    • Overall deficit of 1 per cent of GDP.
    • Overall deficit of 2 per cent of GDP.

Sorry, quiz 699 is now closed.

You can find the answers and discussion here

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