If a Country Had a Rule That Required the Ratio

question 80

Multiple Choice

If a country had a rule that required the ratio of debt to GDP to be constant, it would necessarily have to run a surplus if

• A)real GDP rose and the inflation rate were positive.
• B)real GDP rose and the inflation rate were negative.
• C)real GDP fell and the inflation rate were positive.
• D)real GDP fell and the inflation rate were negative.

---

Definitions:

Manufacturing Overhead Cost

All indirect costs associated with manufacturing, including indirect labor, materials, and expenses that cannot be directly attributed to a specific product.

Units Produced

The total quantity of finished goods a company produces over a specific period of time.

Product Costs

Expenses directly associated with the production of goods or services, including materials, labor, and manufacturing overhead.

Variable Cost

A cost that varies with the level of output, including expenses such as materials and labor directly tied to the production volume.