Quiz #626

• 1. The automatic stabilisers built into national government fiscal frameworks work in a counter-cyclical manner.
• False
• True
• 2. If the nation is running a current account deficit accompanied by a government sector surplus (of equal proportion to GDP as the external deficit), then the private domestic sector must be spending less than they are earning.
• False
• True
• 3. To ensure that the financial system is stable, the central bank has to allow the money supply to be driven by the monetary base.
• False
• True

Quiz #626 answers

• 1. The automatic stabilisers built into national government fiscal frameworks work in a counter-cyclical manner.

Answer: True

• 2. If the nation is running a current account deficit accompanied by a government sector surplus (of equal proportion to GDP as the external deficit), then the private domestic sector must be spending less than they are earning.

Answer: False

• 3. To ensure that the financial system is stable, the central bank has to allow the money supply to be driven by the monetary base.

Answer: False