Drop down options: 1: 51% 55.3%. 47.2% 50.5% 2: 26.8% 25.2% 26.1% 24.7% 3: incre

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Drop down options: 1: 51% 55.3%. 47.2% 50.5% 2: 26.8% 25.2% 26.1% 24.7% 3: increase / decrease 4: 49.5% 44.7% 49% 30.7% 5: increase/ decrease Aplz Student Question ring Prat- eerngagean My Home IN Suggested Sites. WebSlice Gallery. 4. Thepublic debt Ownership The following table contains approximate figares for gross domestic product (GDP) and the national debt in the Unitod States for June 2007 and June 2011. The national debt represents the total amount of money owed by the federal governenent to holders of U.S. securities. All numbers are in trillions of dollars Total National Debt Held Outside Fed. Govt. and Fed. Reserve Foreign Ownership Debt Held by Federal Government and Federal Debt U.S. Ownership (External National Debt) (Trilions of Dollars) (Trillions f (Trillions of Dollars) (External National Debt) CTrilions of Dollars) (Trilions of Dollars) une 2007 13.7 2.2 2.0 June 2011 15.2 14.3 4.6 4.5 5.2 Source: "U.S. Treasury, Bureau of Ecosomic Analysis Net public debt is the portion of the national debe that is held outside the federal govemment and the Federal Reserve System. In June 2007, the net public debt as a percentage of total national debt was In June 2007, the percentage of the U.S. nationall debt held by foreigners (external national debt) was The fraction of the national debt held by foreigners will eventualy need to be repaid to foreigners, thereby reducing the collective purchasing power of

Explanation / Answer

Net public debt in 2007 = 2.2 + 2.0 = 4. Total debt in 2007 = 8.9. Net public debt as a percentage of total national debt in 2007 was = 4.2*100/8.9 = 47.19%

External national debt (foreign ownership) as a percentage of national debt = 2.2*100/8.9 = 24.72%

In 2007, the fraction of national debt held by foreigners was 2.2*100/8.9 = 24.72% and in 2011 it was 4.5*100/14.3 = 31.47% so it increased between 2007 and 2011

As a percentage of GDP, federal debt held by public in 2007 was 4.2*100/13.7 = 30.65%. In 2011, it was 9.7*100/15.2 = 63.81% Hence it increased in 2011.

1: 47.2%

2: 24.7%

3: increase

4: 30.7%

5: increase

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