What can happen when a government continues to both borrow heavily and increase government debt?

Question

Quizplus · Accepted Answer

When a government continues to borrow heavily and increase government debt, it can lead to a situation known as a "debt trap," where the government becomes unable to repay its debts and may have to resort to austerity measures such as spending cuts or tax increases. This can lead to a decrease in economic growth and even a recession, as businesses and consumers have less money to spend due to the government's austerity measures.

What Can Happen When a Government Continues to Both Borrow