Explain the difference between the deficit and the national debt. Why do some believe that the debt/GDP ratio is the most significant piece of related data?
Explain the difference between the deficit and the national debt. Why do some believe that the debt/GDP ratio is the most significant piece of related data?
Chapter13: Federal Deficits, Surpluses, And The National Debt
Section: Chapter Questions
Problem 3SQP
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Explain the difference between the deficit and the national debt. Why do some believe that the debt/
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Step 1
Debt-to-GDP ratio is an important economic measure that helps to compare the debt of a nation and its gross domestic product. It is expressed in percentage terms. It is determined as:
GDP is defined as the money value of finished goods and services produced within the domestic boundaries of a country during a given period.
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