Burden of the national debt, Managerial Economics

Burden of the national debt

The extent of the burden on a nation of public debt, depends in the first place on whether it is an external or an internal debt.  The burden of the national debt to the community can be approximated by the cost of serving it.  The cost of servicing the public debt can be calculated:

i.   Per head of the population, or

ii.  As a percentage of government revenue, or

iii.  As a percentage of the national income.

Whichever method used, the National debt shall have the following burden on society:

  • If higher taxation is required to service a debt which might have disincentive effects resulting in a lower level of output, then this is a burden.
  • If the debt is held by foreigners, goods will need to be exported to pay the interest and possible repayment of capital. This part of the debt will involve a great burden.
Posted Date: 11/30/2012 4:16:50 AM | Location : United States







Related Discussions:- Burden of the national debt, Assignment Help, Ask Question on Burden of the national debt, Get Answer, Expert's Help, Burden of the national debt Discussions

Write discussion on Burden of the national debt
Your posts are moderated
Related Questions
what is the uses of production functns?

You own a pharmaceutical company that is specialized in the manufacture of medicine for smokers. You newly patented an innovative drug called Clealung, which drastically reduces th

A firm in a perfectly competitive market invents a new situation of production that lowers its marginal costs.  What happens to its output? What happens to the price it charges?

Increase in demand SS is the supply curve and D 1 D 1 the initial demand curve shifts to the right, to position D 2 D 2 .  P 1 is the initial equilibrium price and q 1

The following represents the section headers you should consider for your reasoned document.   Each section should have (at least) two research citations to support your work :

Describe about regression analysis An illustration from the automobile industry is befitting for explaining the forecasting method that uses simple regression analysis. Let's p

The Spendthrift Economy This assumes a circular flow of income in a closed economy with no Government sector and no foreign trade.   It also assumes the existence of two sect

State the Fixed factor of production Input level of a fixed factor can't be varied in the short run. Capital falls under the category of fixed factor. Capital alludes to resour

Question: a. What are the basic attributes in designing a good tax system? b. Explain briefly how tax systems affect economic efficiency. c. The trade unionists advocat

When Burton Cummings graduated with honors from the Canadian Trucking Academy, his father gave him a $350,000 tractor-trailer rig. Recently, Burton was boasting to some fellow truc