Why does the government not have to repay debt, as do private individuals?
A)Because the government can ignore creditors and refuse payment.
B)Because the government, as a dictatorship, is unresponsive to demands for repayment.
C)Because the government has no debt; it owes it to itself.
D)Because the government does not have a finite life, as do individuals.

Question

Quizplus · Accepted Answer

Private individuals have a finite lifespan and thus are expected to repay their debts during their lifetime. However, the government has no such limitation as it is a perpetual entity. It is assumed that the government will continue to exist indefinitely, and thus it does not have to repay all of its debt at once. The government can continue to issue new debt to pay off old debt or roll over existing debt into new obligations. Therefore, the government has the ability to continue servicing its debt without the need for repayment.

Why Does the Government Not Have to Repay Debt, as Do