The Weekend Quiz – December 17-18, 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 #712

• 1. When a government runs a continuous deficit (spending more than they are receiving in revenue), the risk is that the accumulated public spending will build up over time and cause inflation.
• False
• True
• 2. If governments allowed the automatic stabilisers built into the government balance to work counter-cyclically and avoided discretionary shifts in fiscal policy, the fiscal balance would return to its appropriate level after a cyclical disturbance.
• False
• True
• 3. If the household saving ratio rises and there is an external deficit then Modern Monetary Theory tells us that the government must increase net spending to fill the private spending gap or else national output and income will fall.
• False
• True

Sorry, quiz 712 is now closed.

You can find the answers and discussion here