Net interest payments made by the government depend on the total federal debt held and on the level of interest rates.

Question

Quizplus · Accepted Answer

Net interest payments made by the government increase as the federal debt held increases and as interest rates rise, and decrease as the federal debt held decreases and as interest rates fall. Therefore, net interest payments are affected by both the level of federal debt held and the level of interest rates.

Net Interest Payments Made by the Government Depend on the Total