1. Growth in private investment requires a pool of saving to draw upon. This means that if government net spending is also drawing on those savings (even if the borrowing is voluntary) then less will be available for private capacity building. That is appropriate though when investors are pessimistic.

2. Mainstream economic theory considers output per unit of person employed (labour productivity) to be counter-cyclical (rises when activity falls and vice versa) - given they think the demand for labour is inversely related to the real wage. That is, they believe that when firms employ more workers productivity drops and so the real wage also have to fall to make it profitable. The real world observation that hours worked are adjusted before persons employed in response to changes in sales volumes means that output per unit of person employed is pro-cyclical which renders the main insights of orthodox labour demand theory inapplicable.

3. If employment growth is 2 per cent per annum; labour force growth is 2 per cent per annum and labour productivity growth (in persons employed) is 1 per cent per annum, then you know GDP growth is insufficient to stop the unemployment rate from rising (assuming weekly hours worked is constant).

4. Irrespective of the government's policy intention, it will always be in deficit if the non-government sector desires to save in the currency of issue and acts accordingly.

5. Real unit labour costs (RULC) are measured by dividing the real wage by output per unit of employment (labour productivity) and tell us how much in labour terms each unit of output cost to produce. RULC always rise when employment falls which is a good empirical indicator that real wages are too high.

1. Growth in private investment requires a pool of saving to draw upon. This means that if government net spending is also drawing on those savings (even if the borrowing is voluntary) then less will be available for private capacity building. That is appropriate though when investors are pessimistic.

Answer: False

Explanation: You might like to review Twisted logic and just plain misinformation for further information or post a comment.

2. Mainstream economic theory considers output per unit of person employed (labour productivity) to be counter-cyclical (rises when activity falls and vice versa) - given they think the demand for labour is inversely related to the real wage. That is, they believe that when firms employ more workers productivity drops and so the real wage also have to fall to make it profitable. The real world observation that hours worked are adjusted before persons employed in response to changes in sales volumes means that output per unit of person employed is pro-cyclical which renders the main insights of orthodox labour demand theory inapplicable.

Answer: True

Explanation: You might like to review Dumbed down economy doesnt lose as many jobs for further information or post a comment.

3. If employment growth is 2 per cent per annum; labour force growth is 2 per cent per annum and labour productivity growth (in persons employed) is 1 per cent per annum, then you know GDP growth is insufficient to stop the unemployment rate from rising (assuming weekly hours worked is constant).

Answer: False

Explanation: You might like to review The waves of recession for further information or post a comment.

4. Irrespective of the government's policy intention, it will always be in deficit if the non-government sector desires to save in the currency of issue and acts accordingly.

Answer: True

Explanation: You might like to review Some myths about modern monetary theory and its developers for further information or post a comment.

5. Real unit labour costs (RULC) are measured by dividing the real wage by output per unit of employment (labour productivity) and tell us how much in labour terms each unit of output cost to produce. RULC always rise when employment falls which is a good empirical indicator that real wages are too high.

Answer: False

Explanation: You might like to review Dumbed down economy doesnt lose as many jobs for further information or post a comment.