1. Background information Aa Aa Read the article from Daily Finance in the follo
ID: 1118594 • Letter: 1
Question
1. Background information Aa Aa Read the article from Daily Finance in the following scroll box and then answer the subsequent questions. How the Debt Ceiling Issue Will Hit Ordinary Americans in the Wallet By Loren Berlin, Daily Finance June 4, 2011 The ongoing debate surrounding America's looming debt ceiling is big news inside the Beltway and in the press, but for many of us, even the phrase "debt ceiling" sounds too far removed from daily life to be of much interest. But ignoring this latest political battle would be a mistake: How the government handles the nation's debt limit will directly affect our personal finances in all sorts of important ways. Source: SXC.hu Before we dive into how all this could hit your wallet, here's a quick refresher course on the issue. Like every other country on Earth, America borrows money to pay for its services. But legally, there's a limit to how much money the federal government can borrow. Congress holds the purse strings: If more borrowing is needed, they have to approve it. Every time we've bumped up against that ceiling in the past, the legislative branch has simply increased the nation's credit limit. Our problem right now is that the United States is only a few billion dollars from reaching its $14.294 trillion debt limit, and our elected officials aren't ready to pick the simplest choice, the one that past Congresses have made. This time: There's debate. Should they raise the debt ceiling in order to borrow more money? Or do they hold the line and start Source: Berlin, Loren. "How the Debt Ceiling Issue Will Hit Ordinary Americans in the Wallet," Daily Finance. 4 June 2011. Content © 2011 AOL, Inc. Daily Finance is a trademark of AOL, Inc. Used with permission. According to the article, which of the following is the most plausible effect of nearing the debt ceiling on the value of the U.S. dollar?Explanation / Answer
b> The US Dollar will appreciate
Reason
It clearly says in the article, the US dollar can potentially be of less value because of the inability to pay back debts.
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.