The following describes some key variables regarding public debt in the UK. Debt to output is 95%, the growth rate of output is 1.2%, and the interest rate on debt is 1.5%. a) What is the primary surplus the government has to run as a percentage of output to ensure a stable debt to output ratio if there is no seigniorage from printing money? (20%)
The following describes some key variables regarding public debt in the UK. Debt to output is 95%, the growth rate of output is 1.2%, and the interest rate on debt is 1.5%. a) What is the primary surplus the government has to run as a percentage of output to ensure a stable debt to output ratio if there is no seigniorage from printing money? (20%)
Chapter1: Making Economics Decisions
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The following describes some key variables regarding public debt in the UK. Debt to output is 95%, the growth rate of output is 1.2%, and the interest rate on debt is 1.5%.
a) What is the primary surplus the government has to run as a percentage of output to ensure a stable debt to output ratio if there is no seigniorage from printing money? (20%)
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