The government can continuously issue new bonds to pay the interest on its outstanding bonds so long as
A) the real GDP growth rate exceeds the real interest rate.
B) the real interest rate exceeds the real GDP growth rate.
C) the real interest rate exceeds the nominal interest rate.
D) the nominal interest rate exceeds the cost of borrowing.
A
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Joe's budget constraint equals 500 = 2F + 100S, where $500 is Joe's income, $2 is the price of food (F) and $100 is the price of shelter (S). How much food can Joe buy if he buys one unit of shelter?
A) 2 units B) 200 units C) 250 units D) 400 units
Most macroeconomists agree that the fundamental issues facing an economy are
a. unemployment and inflation, and what should be done about them b. the economy's long-run equilibrium position and how to get there c. the quantity of money and its velocity d. the long-run Phillips curve and the Laffer curve and whether they generate conflicting outcomes e. government deficits and high taxes