Solved

Consider a Government with a Positive Stock of Debt

Question 84

Multiple Choice

Consider a government with a positive stock of debt. If the growth rate of real GDP exceeds the real rate of interest on government bonds, then to keep the debt- to- GDP ratio constant the


A) government must implement an expansionary fiscal policy.
B) nominal interest rate must be constant.
C) money supply should be increased at a constant rate.
D) government must have a primary budget deficit.
E) government must have a primary budget surplus.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents