Which of the following best explains why the debt-to-GDP ratio important?
A)If GDP is rising slower than debt, the government is, in some sense, living within its means.
B)A declining debt-to-GDP ratio raises concerns about a country's financial difficulties.
C)It is a better measure than the level of debt because it takes into account a country's net exports.
D)It allows international comparisons of how indebted countries are.

Question

Quizplus · Accepted Answer

The debt-to-GDP ratio is important because it allows for international comparisons of how indebted countries are relative to the size of their economies, providing a context for the level of debt.

Which of the Following Best Explains Why the Debt-To-GDP Ratio