1. If the annual inflation rate is greater than the growth in money wages, we can conclude that there has been a redistribution of national income towards profits because the real wage has fallen.
Answer: False
2. The non-government sector net wealth rises when there are government fiscal deficits, because, under current institutional practices, governments issue bonds to exactly match ($-for-$) their deficits.
Answer: False
3. Assume that a national is continuously running an external deficit of 2 per cent of GDP. In this economy, if the private domestic sector successfully saves overall, we would always find: