How Is the Public Debt Calculated

question 43

Multiple Choice

How is the public debt calculated?

• A) By subtracting the government's total liabilities from its total assets
• B) By cumulating the annual government purchases over time
• C) By subtracting current government spending from current government tax revenues
• D) By cumulating the annual difference between tax revenues and government spending over the years

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Definitions:

Risk Diversified

The strategy of spreading investments across various assets to reduce exposure to risk in any single area.

Expected Income

The amount of income an individual anticipates or forecasts to receive over a certain period.

Probability

A numeric evaluation representing the probability of an event taking place, where 0 signifies no chance and 1 signifies certainty.

Expected Income

The weighted average of all possible income outcomes, where the weights are the probabilities of each outcome occurring.