Quiz #523

• 1. Larger fiscal deficits as a percentage of GDP typically mean that there are less real resources available for other productive uses.
• True
• False
• 2. For a nation running a current account deficit, income adjustments will ensure government fiscal position is in deficit if the domestic private sector seeks to increase its saving overall as a percentage of GDP.
• True
• False
• 3. Higher levels of taxation permit the government to increase its real spending.
• True
• False

Quiz #523 answers

• 1. Larger fiscal deficits as a percentage of GDP typically mean that there are less real resources available for other productive uses.

Answer: True

• 2. For a nation running a current account deficit, income adjustments will ensure government fiscal position is in deficit if the domestic private sector seeks to increase its saving overall as a percentage of GDP.

Answer: True

• 3. Higher levels of taxation permit the government to increase its real spending.

Answer: True