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Saturday Quiz – November 22, 2014

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

1. As a matter of accounting, the financial assets held by the non-government sector rise $-for-$ when a sovereign government issues debt to match its current fiscal deficit.



2. When government bond yields for new issues start to rise, government spending becomes more expensive.



3. Open market operations as a means of ensuring that levels of bank reserves are consistent with the monetary policy target become redundant whenever the central bank pays a positive interest rate on overnight reserves held by the commercial banks (ignore any reserve requirements in place when answering).





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