Which of the following provides the best explanation of the purpose of calculating a government's debt service burden?
A) The greater the portion of revenues consumed by debt service, the less flexibility there is to issue additional debt and to meet operating expenditure needs.
B) The greater the portion of revenues consumed by debt service, the more likely it is that government is spending excessively on infrastructure assets.
C) The greater the portion of revenues consumed by debt service, the more likely it is that the government is "backloading" its debt service payments.
D) The greater the portion of revenues consumed by debt service, the more likely it is that the government will raise tax rates in the near future.
Correct Answer:
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