Quiz #597 answers

• 1. If the inflation rate is steady and the central bank maintains a constant nominal interest rate, then the public debt ratio will rise if the government deficit doubles, not that that observation is of any concern.

Answer: False

• 2. Real wage increases require the rate of growth in earnings to be faster than labour productivity growth.

Answer: False

• 3. A fiscal surplus indicates that the national government is trying to slow the economy down and contain inflation.

Answer: False