Quiz: Chapter 13 Quiz Submit Quiz This Question: 5 pts 12 of 20 (8 complete) Thi

Question

Quiz: Chapter 13 Quiz Submit Quiz This Question: 5 pts 12 of 20 (8 complete) This Quiz: 100 pts possib Question Help Choose the statement about U.S. international debt that is incorrect. O A. To repay the intenational debt, U.S. saving must increase and consumption must decrease 0 B. In June 2014, the United States had a net debt to the rest of the world of $11.7 trillion OC. About 48 percent of U.S. govenment debt is held by foreigners. 0 D. Borrowing from the rest of the world as a source of loanable funds decreased during the late 1990s and 2000s.

Explanation / Answer

First question :-  The incorrect statement is C because more than 48% of the debt is held by foreigners.

Second question:- The answer is option is to increase the exports over imports so as to increase the cash inflow which can be used to pay the debts.

Third question:- The answer is option is C. It is because cyclical deficits are due to economic downfall and structural deficit are due to ongoing deficits and also due to the automatic stabilizers the economic trends are offset leading to increase in demand.

Fourth question:- The answer is option D because the multiplier would be less than 1 and not greater than 1.

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