Which of the following will reduce the negative impact the debt to GDP ratio will have on the U.S. economy?
A) Low interest rates, because they will reduce the burden accompanying outstanding debt.
B) High interest rates, because they will reduce the burden accompanying outstanding debt.
C) Declining GDP and lower tax revenue.
D) A larger proportion of the population in retirement collecting Social Security payments.

Question

Quizplus · Accepted Answer

Low interest rates reduce the burden accompanying outstanding debt, as it decreases the amount of money the government has to pay back in interest. This can help mitigate the negative effects of a high debt to GDP ratio on the economy.

Which of the Following Will Reduce the Negative Impact the Debt