Quiz #574

• 1. Given that most governments are sovereign in their own currencies, there is no limit on the expenditure that these governments can introduce to deal with the coronavirus emergency.
• False
• True
• 2. A rising government deficit will always allow the household sector to increase its saving in nominal terms
• False
• True
• 3. A rising government deficit always indicates an expansionary shift in policy.
• False
• True

Quiz #574 answers

• 1. Given that most governments are sovereign in their own currencies, there is no limit on the expenditure that these governments can introduce to deal with the coronavirus emergency.

Answer: False

• 2. A rising government deficit will always allow the household sector to increase its saving in nominal terms

Answer: True

• 3. A rising government deficit always indicates an expansionary shift in policy.

Answer: False