Quiz #533 answers

• 1. The only way that you can have unbalanced external accounts across nations (some countries with surpluses and other deficits) is because the surplus countries desire to hold financial assets denominated in the currency of the deficit countries.

Answer: True

• 2. Like anything in abundance, it is true that when there is more "money" in the economy its value declines.

Answer: False

• 3. The imposition of a fiscal rule at the national government level that the fiscal account has to be in balance at all times would eliminate fiscal balance swings driven by the automatic stabilisers.

Answer: False