If the economy is growing 3% a year and the government increases the ratio of interest on the national debt to GDP,we may conclude that

Question

Quizplus · Accepted Answer

Increasing the ratio of interest on the national debt to GDP means that the government will be spending a larger proportion of GDP on interest payments, which in turn means less money available for other government spending, such as investment or welfare programs. This could limit economic growth and potentially reduce tax revenues, leading to an increase in the national debt. Consequently, the additional interest payments may exceed the 3% growth rate of the economy.

If the Economy Is Growing 3% a Year and the Government