External debt rises from 5 percent of GDP to over 30 percent of GDP. This increase in external debt is:

Question

Quizplus · Accepted Answer

Repayment of external debt often requires the government to allocate a significant portion of its revenue for this purpose, which can lead to a reduction in public spending or an increase in taxes. Both of these outcomes can result in a net reduction in the disposable income of the average citizen, making it a potential problem.

External Debt Rises from 5 Percent of GDP to Over