Consider a government with a balanced primary budget. The interest rate is 5 percent. The growth rate

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Consider a government with a balanced primary budget. The interest rate is 5 percent. The growth rate of nominal GDP is 2 percent. The initial debt-GDP ratio is 10 percent. Over time, the debt to GDP ratio will grow by:

a.5 percent.
b. 10 percent.
c.2 percent.
d.3 percent.

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Introduction to Finance Markets, Investments and Financial Management

ISBN: 978-1119398288

16th edition

Authors: Ronald W. Melicher, Edgar A. Norton

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Posted Date: Nov 11, 2020 11:46 PM

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Consider a government with a balanced primary budget. The interest rate is 5 percent. The growth rate

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Ans Wer Option D Because the ret change will ... View the full answer

Introduction to Finance Markets, Investments and Financial Management

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