Quiz #583 answers

• 1. Modern Monetary Theory (MMT) refutes the claim that government spending can crowd out private spending.

Answer: False

• 2. In general, the OECD and IMF estimates of the impact of the automatic stabilisers in-built into fiscal policy are biased downwards.

Answer: True

• 3. When a government runs a continuous fiscal deficit public spending builds up over time and eventually exposes the economy to inflation risk.

Answer: False