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Saturday Quiz – November 7, 2015

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. Assume that the national accounts of a nation is reveal that its external surplus is equivalent to 2 per cent of GDP and the private domestic sector is saving overall 3 per cent of GDP. We would also observe: .

2. There is no difference in terms of the impact on aggregate demand, between the government matching its deficit spending with bond issues and a situation where the government instructs the central bank to buy its bonds to match the deficit.

3. The Italian government's projected fiscal deficit for 2016 will be lower as a percentage of GDP than its estimated 2015 outcome. It is correct to conclude that in 2016 it will still be pursuing a contractionary fiscal policy stance despite the political rhetoric about its fiscal position being expansionary.

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