Quiz #532 answers

• 1. The private domestic sector can save overall even if the government fiscal balance is in surplus as long as net exports are positive.

Answer: False

• 2. Central bankers are talking about the possible need for more quantitative easing (QE) as their economies start to slow down. By adding bank reserves, QE is similar to a net fiscal injection in this respect.

Answer: False

• 3. While continuous national governments deficits are recommended if the non-government sector desires to save, they do imply continuously rising public debt levels as a percentage of GDP under current institutional arrangements.

Answer: False