The Weekend Quiz – September 24-25, 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 #702

• 1. Only one of the following propositions is possible for a nation with an external deficit over any given period (with all balances expressed as a per cent of GDP): A public surplus of equal size to the external deficit, with the private domestic sector dis-saving overall. A public surplus larger than the external deficit, with the private domestic sector saving overall
• A public surplus of equal size to the external deficit, with the private domestic sector saving overall.
• A public surplus of equal size to the external deficit, with the private domestic sector dis-saving overall.
• A public surplus larger than the external deficit, with the private domestic sector saving overall
• 2. If in attempting to estimate the cyclical component of a government fiscal outcome we underestimate the potential capacity of an economy, we will conclude that the government's discretionary fiscal position is less expansionary than it actually is.
• True
• False
• 3. Governments concerned with their public debt ratio should encourage growth because the debt ratio always falls once economic growth resumes.
• True
• False

Sorry, quiz 702 is now closed.

You can find the answers and discussion here