Here are the answers with discussion for this Weekend’s Quiz. The information provided should help you work out why you missed a question or three! If you haven’t already done the Quiz from yesterday then have a go at it before you read the answers. I hope this helps you develop an understanding of Modern…
The Weekend Quiz – December 23-24, 2017
Welcome to The Weekend Quiz. The quiz tests whether you have been paying attention or not to the blogs I post. See how you go with the following questions. Your results are only known to you and no records are retained.
Quiz #457
- 1. If there is more "money" in the economy its value will decline.
- False
- True
- 2. A public works program that employs workers to dig deep holes on one day and then fill them in again the next day makes exactly the same contribution to current economic growth ($-for-$) as a private firm investing in a new factory to build jet airplanes or a new hospital.
- False
- True
- 3. Economists note that the automatic stabilisers built into fiscal policy, increase deficits (or reduce surpluses) in times of slack aggregate demand. This sensitivity of the fiscal outcome to the economic cycle would be eliminated if the government followed a rule that required a zero fiscal balance at all times ('balanced budget rule').
- False
- True
- 4. Special holiday question: Santa Claus and his elves are in danger of becoming environmental refugees because:
- As the sea melts the methane deposits around the shoreline will be released and further accelerate global warming.
- There is no threat - Santa Claus and climate change are just rumours spread by socialists.
- Arctic sea ice shrank 18 per cent in the year to September 2012, accelerating a trend observed in recent years.
- The National Oceanic and Atmospheric Administration predicts that the Arctic will have no summer sea ice within 30 years.
- 5. Special holiday question: The Australian Bureau of Statistics does not record official reindeer numbers. However, the Population Census tells us that there are several deer farmers in Australia who could help Santa should any of his deer get tired as he flies around Australia in the early hours of Monday morning. The Census shows that there are:
- 35 deer farmers in Australia.
- 25 deer farmers in Australia.
- 15 deer farmers in Australia.
- I just made this all up.
Sorry, quiz 457 is now closed.
You can find the answers and discussion here
Three outa five! Got the Xmas ones wrong would you believe!
Merry Christmas, Bill to you and yours.
Same here, first 3 out 3 ever and I get the dumb questions wrong.
Happy Christmas all.
Hello,
On question 2. If someone gets paid to dig and then fill in holes they have not added to the productive capacity of the economy.
If a jet factory or a hospital is built, whether private or public, productive capacity has been increased and is therefore not the same as unproductive hole digging and filling in.
I would have thought that true would be nearer the correct answer for the reasons given above.
Probably the question turns on the phrase “current economic growth”. In that in this accounting period, the contribution is the same: something gets built workers are paid for doing it. Then in the next accounting period, one has the extra productive capacity of the jet factory or hospital.
Dunno just my guess. Or the answer is wrong and should be false.
Question two caught me out. I took the route that the hole digging was labour only and delivered instant spending into the economy. The factory and jet building would required the purchase of intermediate goods and”might” involve some degree of lag before construction. I figured that hole digging might very well get the multiplier going before the factory and jet building caught up, possibly delivering more to growth(at least in the early stages) over the current fiscal period.
And that my friends is why I often get multiple choice wrong. Over analysis.
I am from the Caribbean so I decided to leave Santa and the Australian deer farming alone..LOL
I’ve always believed that Keynes’ example of miners digging up treasuries out of abandoned gold mines, said Treasuries put there by the government to begin with, was sarcasm and mockery of the gold standard. And by inference, mockery of the lack of ambition embedded into the gold standard: All part of a consistent meme of Keynes where we don’t have beautiful cities because ‘it doesn’t pay,’ but we build slums because it does.
prof. Mitchell-I’m reluctant to question your authority in regards to Australian deer farming,but the Australian Gov. rural Industries and research corp states:
There are 196 deer farms in Australia, with most located in Victoria (35%), South Australia (24%) and New South Wales (12%). National herd size is 43,856, with red deer making up 48%, followed by fallow deer (44%), and smaller numbers of rusa, elk, sambar, chital, sika cross, hog deer and other species.
However , I have just noted that that report was from 2010!!! That’s a pretty sharp decline in seven years! maybe the 196 had groups of farms under the control of one farmer???
“Current” got me in question 2…
Santa Claus is a story that capitalists like- it makes people go out and buy a lot of their products. Socialists like me want the government to act like Santa sometimes. Your answer to question 4 is completely wrong I tell you. Oh well, please have a happy Christmas and thank you for the quiz!
35 deer farmers evidently
I’m not surprised at all.
4/5 – only the deer farming was wrong! Bill Mitchell I hope you have a wonderful Christmas. Discovering your blog and met was the best thing about my 2017. Always been a socialist in search of a reasonable economic paradigm and now I have found it. Randomly watching economic talks on YouTube came across Mosler et Al….changed my whole intellectual understanding of economics. Thank you.