Quiz #545 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. There is talk among central bankers of renewed programs of quantitative easing to fight off fears of recession as a result of the trade tensions. Fiscal stimulus is also being proposed. The two work in different ways but have the same ultimate impact on net worth in the non-government sector.

Answer: False

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

Answer: False