To measure the effect of debt in an economy, economists use a standard measure which involves the ________ relative to the GDP.
A) stock market activity
B) outstanding government bonds
C) stock of debt
D) capital stock of equipment

Question

Quizplus · Accepted Answer

Economists use the ratio of the stock of debt to the GDP as a standard measure to assess the effect of debt in an economy. This ratio reflects the size of a country's economy relative to its outstanding debt obligations, and it is used to evaluate a country's ability to service its debt. A higher ratio indicates that a country's debt burden is heavier and may lead to potential problems in managing the debt.

To Measure the Effect of Debt in an Economy, Economists