Answer Happy

1.. Suppose the government aims to reduce the debt to GDP
ratio.
(a) Budget surpluses are always required to reduce the debt-to-GDP
ratio.
(b) Budget surpluses are never required to reduce the debt-to-GDP
ratio.
(c) Budget surpluses are required if the nominal interest rate is
higher than the growth rate of the economy.
(d) Budget surpluses are required if the nominal interest is above
the real interest rate.
2. Which of the following statements is false?
(a) “Federal debt held by the public” includes federal debt that is
held by the Federal Reserve.
(b) “Federal debt held by the public” includes federal debt that is
held by Social Security trust funds.
(c) Gross federal debt includes federal debt held by international
investors.
(d) Gross federal debt includes any type of “federal debt held by
the public"