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Consider the Following Variables,defined as Follows: D = Debt-To-GDP Ratio

Question 80

Multiple Choice

Consider the following variables,defined as follows: d = debt-to-GDP ratio
X = primary budget deficit as a percentage of GDP
R = real interest rate on government bonds
G = growth rate of real GDP
Which of the following expressions correctly describes the change in the debt-to-GDP ratio?


A) Δd = x + (r - g) + d
B) Δd = x + (r - g) × d
C) Δd = x(r - g) + d
D) Δd = x(g - r) - d
E) Δd = x + (g - r) × d

Correct Answer:

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