Consider the Following Data About Government Debt and Deficit in a Given

question 15

Multiple Choice

Consider the following data about government debt and deficit in a given year: - real interest rate on government bonds = 3%
- growth rate of real GDP = 1%
- current debt-to-GDP ratio = 40%
- primary budget deficit as a percentage of GDP = 2%
Over this one-year period,the debt-to-GDP ratio will have risen by

• A)82 percentage points.
• B)8.2 percentage points.
• C)0.82 percentage points.
• D)2.8 percentage points.
• E)0.28 percentage points.

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Definitions:

Ophthalmoscope

An instrument used by doctors to examine the interior of the eye, including the retina and optic nerve.

Stethoscope

A medical instrument used for listening to the sounds generated within the body, particularly the heart and lungs.

Hyperventilating

Breathing at an abnormally rapid rate, which can lead to decreased carbon dioxide levels in the blood, sometimes causing lightheadedness or fainting.

Supine Position

A body position where someone lies flat on their back facing upwards.