What does it mean for a nation to have a foreign debt of ten times the GNP?
A) It means the nation owes foreign creditors ten times the value of goods and services produced annually by the nation's citizens.
B) It means the nation owes foreign creditors interest at a rate of ten times what it borrowed initially.
C) It means the nation is owed ten times what it lent out to foreign nations.
D) It means the nation is owed ten times the value of the foreign borrowers' annual employment earnings.

Question

Quizplus · Accepted Answer

A nation's foreign debt refers to the amount of money that the nation owes to foreign creditors. A foreign debt that is ten times the GNP means that the nation owes foreign creditors an amount that is equal to ten times the value of the goods and services produced annually by the nation's citizens. This can be a cause for concern as it may indicate that the nation has borrowed beyond its means and may struggle to repay its debts.

What Does It Mean for a Nation to Have a Foreign