Answer Happy

1. use the fact that the nominal deficit equals the nominal
primary deficit pkus nominal interest payments on government debt
to rewrite the equation "change in debt-GDP ratio = deficit/niminal
GDP - (total debt/niminal GDP * growth rate of niminal GDP)"showing
the change in the debt-GDP ratio as a function of the ratio of the
primary defict to GDP, the ratio of debt to GDP, and the difference
between the growth rate of nominal GDP and the nominal interest
rate.
2. show that, if the primary deficit is zero, the change in the
debt-GDP ratio equals the product of (1). the debt-GDP ratio and
(2) the excess of the real interest rate over the growth rate of
real GDP