Suppose in the Beginning of 2006, a Country Has a National

question 23

Multiple Choice

Suppose in the beginning of 2006, a country has a national debt of $8,000 billion.Its GDP in
2006 is $32,000 billion and its budget deficit of $1,600 billion.Compute its debt-GDP ratio at the end of the year.

• A)5%
• B)20%
• C)25%
• D)28.6%

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Definitions:

Operating Activities

Activities directly related to the production and delivery of goods and services, which are central to a company's operations and cash flow.

Residual Value

The estimated amount that an asset is expected to be worth at the end of its useful life.

Straight-Line Method

A method of calculating depreciation by evenly spreading the cost of an asset over its useful life.

Depreciable Asset

An asset that loses value over time due to wear and tear, and its cost is expensed across its useful life.