Question

Which of the following is true of the federal debt?
a. It has been increasing over time.
b. It has been decreasing over time.
c. There has been a sharp decline in the federal debt.
d. The federal debt ceiling has been established by law since the Great Depression.

Answer 1

Answer is A. Its been increasing over time.

National Debt is not necessarily a bad thing to have for governments as long as the debt does not accumulate to over 125% of a country's GDP. At that level, national debt is said to be unsustainable. US debt to GDP is around 70% according to the CIA, this is a perfectly acceptable level. Although the debt value itself is actually rising, its percentage value against GDP is what is important about it.

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