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Saturday Quiz – May 16, 2009

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 five questions. Your results are only known to you and no records are retained.

1. The US Government has predicted a national deficit of 12.9 per cent of gross domestic product by September 30 and rising. In Tuesday's Budget it was estimated that the Australian Government deficit to GDP ratio would be around 4.9 per cent in the coming fiscal year. The difference arises because

2. While it is true that the federal government is not revenue-constrained, the fact that it voluntarily issues debt every time it net spends

3. The fact that the federal government has to pay back its debt

4. If the structural budget balance is in surplus but the overall budget is in deficit

5. When the budget balance moves into deficit

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    This Post Has 2 Comments
    1. This quiz indicates that most people would laugh at my postings. What’s structural budget balance. Does it have something to do with Taxes and revenue?

    2. 5 out of 5.

      I wouldn’t be too concerned about whether or not you feel that people would laugh at your postings Righty. The weekly quiz exists for the very reason that there are non-economist laypersons (myself included) on this blog, gaining a basic understanding of economics. It’s quite an eye opener. I still can’t believe that I once never gave a second thought as to where Australian denominated currency comes from. Once I understood this, I realised that thinking about a federal budget as though it were just a larger version of our own household budgets and subject to the same constraints, was laughable.

      In a serious kind of way, unfortunately.

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