A Public Debt Which Is Owed to Foreigners Can Be

question 15

Multiple Choice

A public debt which is owed to foreigners can be burdensome because:

• A)foreign interest rates are persistently higher than domestic interest rates.
• B)payment of interest reduces the volume of goods and services available for domestic uses.
• C)payment of interest will conflict with a nation's foreign aid programs.
• D)payment of interest will necessarily have a deflationary effect on prices in the paying nation.

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Definitions:

Lifetime High

The highest price level reached by a stock, bond, or other security during its entire trading history.

Lifetime Low

The lowest price level that a stock or security has reached over the entirety of its trading history.

Forward Contract

A tailor-made agreement between two entities to purchase or sell a valuable at an agreed price on a predetermined date in the future.

July Futures Contract

A standardized, legal agreement to buy or sell a commodity or financial asset at a predetermined price at a specified time in July.