The real interest rate is equal to 0,05. The primary deficit-to-GDP ratio is equal to 0,05. The previous year's debt-to-GDP ratio was equal to 0,5 of GDP. Note: Please, provide the answers in form of decimal numbers (like in the problem) 1. Assume that the rate of growth of real GDP is equal to 0,03. This year's change in the debt-to-GDP ratio is equal to 0.06 2. Calculate the rate of growth of real GDP that is required to stabilize the debt-to-GDP ratio in the current year: This rate of growth of GDP is 0.15 3. Assume that the rate of growth of GDP is equal to 0,1. Debt to GDP will stabilise, when the debt ti GDP ratio is
The real interest rate is equal to 0,05. The primary deficit-to-GDP ratio is equal to 0,05. The previous year's debt-to-GDP ratio was equal to 0,5 of GDP. Note: Please, provide the answers in form of decimal numbers (like in the problem) 1. Assume that the rate of growth of real GDP is equal to 0,03. This year's change in the debt-to-GDP ratio is equal to 0.06 2. Calculate the rate of growth of real GDP that is required to stabilize the debt-to-GDP ratio in the current year: This rate of growth of GDP is 0.15 3. Assume that the rate of growth of GDP is equal to 0,1. Debt to GDP will stabilise, when the debt ti GDP ratio is
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter30: Government Budgets And Fiscal Policy
Section: Chapter Questions
Problem 3SCQ: Is it possible for a nation to run budget deficits and still have its debt GDP ratio fall? Explain...
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