Quiz #457 answers

• 1. If there is more "money" in the economy its value will decline.

Answer: False

• 2. A public works program that employs workers to dig deep holes on one day and then fill them in again the next day makes exactly the same contribution to current economic growth ($-for-$) as a private firm investing in a new factory to build jet airplanes or a new hospital.

Answer: True

• 3. Economists note that the automatic stabilisers built into fiscal policy, increase deficits (or reduce surpluses) in times of slack aggregate demand. This sensitivity of the fiscal outcome to the economic cycle would be eliminated if the government followed a rule that required a zero fiscal balance at all times ('balanced budget rule').

Answer: False

• 4. Special holiday question: Santa Claus and his elves are in danger of becoming environmental refugees because:

Answer: There is no threat - Santa Claus and climate change are just rumours spread by socialists.

• 5. Special holiday question: The Australian Bureau of Statistics does not record official reindeer numbers. However, the Population Census tells us that there are several deer farmers in Australia who could help Santa should any of his deer get tired as he flies around Australia in the early hours of Monday morning. The Census shows that there are:

Answer: 35 deer farmers in Australia.