Suppose the Change in the Government's Debt- To- GDP Ratio

question 102

Multiple Choice

Suppose the change in the government's debt- to- GDP ratio in a given year is 0.026. This figure tells us that the government's debt- to- GDP ratio has

• A)fallen by 2.6 percentage points.
• B)risen by 0.026 percent.
• C)risen by 2.6 percentage points.
• D)risen by 0.026 percentage points.
• E)fallen by 0.026 percent.

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Definitions:

General Annuity

An annuity in which the payment interval does not equal the compounding interval.

Annuity Due

An annuity in which the periodic payments occur at the beginning of each payment interval.

Compounded Monthly

Definition: The process where interest is calculated and added to the principal amount of the deposit or loan every month.

Lump Sum Deposit

A single and typically large payment made at once rather than being divided into multiple payments over time.