That portion of the national debt held by foreigners represents a burden in the form of fewer goods and services for domestic citizens.

Question

Quizplus · Accepted Answer

When a portion of the national debt is held by foreigners, a larger portion of future tax revenues may need to be used to pay interest to these foreign lenders. This reduces the amount of resources available for domestic citizens to use for consumption and investment, leading to a potential reduction in the overall standard of living. Therefore, it can be said that the burden of the debt held by foreigners is borne by domestic citizens in the form of reduced access to goods and services.

That Portion of the National Debt Held by Foreigners Represents