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Compute debt-gdp ratio

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Reference no: EM132813344

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

a. How much will its new national debt be?

b. Compute its debt-GDP ratio.

c. 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: EM132813344

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