Quiz #271

• 1. One of the few advantages of a currency-issuing government issuing bonds to match its deficit spending is that it boosts private sector wealth.
• False
• True
• 2. The stock of government spending continually rises when there are rising fiscal deficits.
• False
• True
• 3. When a government records a budget surplus which means it is withdrawing net purchasing power from the economy and reducing the economic growth rate of the economy, we cannot conclude that it has adopted a policy of austerity.
• False
• True

Quiz #271 answers

• 1. One of the few advantages of a currency-issuing government issuing bonds to match its deficit spending is that it boosts private sector wealth.

Answer: False

• 2. The stock of government spending continually rises when there are rising fiscal deficits.

Answer: False

• 3. When a government records a budget surplus which means it is withdrawing net purchasing power from the economy and reducing the economic growth rate of the economy, we cannot conclude that it has adopted a policy of austerity.

Answer: True