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The Weekend Quiz – January 29-30, 2022

Welcome to The Weekend Quiz. The quiz tests whether you have been paying attention or not to the blog posts that I post. 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 immediately rise $-for-$ when a sovereign government issues debt.

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

3. In a fiat monetary system (for example, US or Australia) with an on-going external deficit that exceeds the public deficit (expressed as percentages of GDP), the domestic private sector cannot reduce its overall debt levels (by saving) without incurring employment losses.

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