Which of the Following Statements About Government Debt Is False

question 51

Multiple Choice

Which of the following statements about government debt is false?

• A)Government has the power to tax to finance its debt.
• B)Government can create money to finance its debt.
• C)Most U.S. government debt is owned by foreigners.
• D)Almost half of U.S. government debt is internal to the government.

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Definitions:

Account Balances

The amount of money in an account at a specific point in time, reflecting all transactions.

Credits

An accounting entry that either decreases assets or increases liabilities and equity on the company's balance sheet.

Debits

An entry recorded on the left side of a double-entry bookkeeping system that increases asset and expense accounts, and decreases liability, equity, and revenue accounts.

Journal

A chronological record of all the financial transactions of a business, used for the process of accounting.