Suppose That for the Nation of Calliope,the Debt-To-GDP Ratio Is

question 3

Essay

Suppose that for the nation of Calliope,the debt-to-GDP ratio is 325%,the average annual growth rate is 1.1%,the average inflation rate is 0.5%,and the average nominal interest rate is 2.2%.Based on this information,determine if fiscal policy is sustainable in Calliope,and if not,what the primary budget deficit would have to be to make fiscal policy sustainable.

---

Definitions:

Nominating Process

The procedure through which political parties select and nominate their candidates for election to public office.

Patronage System

A practice where political leaders provide jobs and favors to their supporters as a reward for political support.

Party Loyalty

The allegiance of an individual to a particular political party, often leading to consistent support and advocacy for that party’s candidates and policies.

Political Parties

Organized groups of people with similar political aims and opinions that seek to influence public policy by getting their candidates elected to public office.