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The Weekend Quiz – June 11-12, 2016

Welcome to The Weekend Quiz, which used to be known as the 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. A sovereign national government, that is, one that issues its own floating currency faces no solvency risk with respect to the debt it issues.

2. One important lesson to be drawn from Modern Monetary Theory (MMT), which is overlooked in the public call for austerity programs, is that when economic growth resumes, the automatic stabilisers work in a counter-cyclical fashion to ensure that the government fiscal balance returns to its appropriate level.

3. It is claimed that Eurozone Member States need to rely on internal devaluation. Austerity programs thus aim to deflate nominal wages and prices in order to restore international competitiveness. Which of the following propositions must also follow according to this logic?

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