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Compute debt-gdp ratio

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Reference no: EM132415507

Problem: Suppose a country has a national debt of $5,000 billion, a GDP of $10,000 billion, and a budget deficit of $100 billion.

Required:

Question 1: How much will its new national debt be?

Question 2: Compute its debt-GDP ratio.

Question 3: Suppose its GDP grows by 1% in the next year and the budget deficit is again $100 billion. Compute its new level of national debt and its new debt-GDP ratio.

Reference no: EM132415507

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