The US Federal Government Is Unlikely to Default on Its Bond

question 59

Multiple Choice

The U.S. federal government is unlikely to default on its bond payments because

• A) if necessary, it can print the money needed to make payments on time.
• B) its bond payments are insured.
• C) the U.S. federal budget usually runs a surplus, providing ample funds for repaying debt.
• D) of all of these.

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Definitions:

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Opportunity Cost

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Black Markets

Illegal markets that arise when selling, trading, or buying goods or services are prohibited by law or are controlled by restrictive practices.

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A legal minimum price below which a good or service cannot be sold, intended to protect producers from market prices that are too low.