Which of the following portions of the national debt impose a net interest burden on the federal government?
A) Treasury bonds held by government agencies.
B) Treasury bonds held by private investors.
C) Treasury bonds held by the Federal Reserve system.
D) Treasury bonds held in the Social Security Trust Fund.

Question

Quizplus · Accepted Answer

Treasury bonds held by private investors impose a net interest burden on the federal government because the government must pay interest to these investors. Bonds held by government agencies or the Federal Reserve typically do not impose a net interest burden as these are intra-governmental holdings.

Which of the Following Portions of the National Debt Impose