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Saturday Quiz – July 9, 2011

Welcome to the billy blog Saturday quiz. The quiz tests whether you have been paying attention over the last seven days. See how you go with the following six questions. Your results are only known to you and no records are retained.

1. A hallmark of the neo-liberal period has been the declining share of wages in national income which in part meant that economic growth became more dependent on credit to maintain growth in consumption spending. Increasing the wage share will require a faster rate of growth in real wages in the coming years.

2. National accounting shows us that a government surplus equals a non-government deficit. If fiscal austerity does generate budget surpluses it does so by swapping public for private debt.

3. In a stock-flow consistent macroeconomics, the sectoral balance stocks all sum to zero.

4. Public spending can "crowd out" private spending.

5. Premium question: The payment of a positive interest return by the central bank on overnight bank reserves eliminates the need for it to conduct open market operations to ensure its policy rate is sustained (ignore any reserve requirements).

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