At the End of World War II, the U

question 7

Multiple Choice

At the end of World War II, the U.S.debt-to-GDP ratio was much higher than it was in 2013 but there was no talk of a "fiscal cliff." This was because

• A)there was no legal debt ceiling in the U.S. in the 1940s
• B)it was assumed that the anticipated reduction in budget deficits combined with economic growth would reduce the ratio quickly
• C)financial investors believed in the ability of the U.S. government to eventually pay off its creditors
• D)all of the above
• E)none of the above

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