Implicit liabilities of a government are:
A)bonds held by foreigners.
B)spending promises, like Social Security benefits, that are effectively debt although no bond is associated with the promise.
C)debt of a country adjusted for the price ratio.
D)the ratio of a country's debt to its GDP.

Question

Quizplus · Accepted Answer

Implicit liabilities refer to government promises to pay future benefits or obligations that are not recorded as debt in the current period. Social Security benefits are an example of an implicit liability as the government has promised to pay these benefits to eligible citizens in the future.

Implicit Liabilities of a Government Are