Which of the following reasons explains in part why debt and deficit situation in the United States is dangerous for the economy? O a. A debt-to-GDP ratio above 100% will likely require interest rates to increase, which will further exacerbate the burden of the debt. O b. With about 45% of all spending in the United States tied to government at some level, the sheer number of people dependent on government spending will limit political power and ability to address government over-spending. Oc. Politicians are very bad at intentionally running budget surpluses during good times as Keynes argued was important. Od. The sheer size of the deficit and debt can prevent further government stimuli from being effective as confidence erodes and leakages (e.g., foreign ownership of debt) benefit from some of the stimulus. Oe. All of the above are reasons to be concerned about the size of the debt and deficit in the United States.

Which of the following reasons explains in part why debt and deficit situation in the United States is dangerous for the economy? O a. A debt-to-GDP ratio above 100% will likely require interest rates to increase, which will further exacerbate the burden of the debt. O b. With about 45% of all spending in the United States tied to government at some level, the sheer number of people dependent on government spending will limit political power and ability to address government over-spending. Oc. Politicians are very bad at intentionally running budget surpluses during good times as Keynes argued was important. Od. The sheer size of the deficit and debt can prevent further government stimuli from being effective as confidence erodes and leakages (e.g., foreign ownership of debt) benefit from some of the stimulus. Oe. All of the above are reasons to be concerned about the size of the debt and deficit in the United States.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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