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
1. A sporting goods company has hired a management consulting firm to analyze demand in 20 regional markets for one of its major products: a treadmill. The consultant uses data to

Management Decisions: An effective demand forecast assists the management to take suitable steps in factors which are relevant to decision making like plant capacity, raw-material

Advantages a.           It is more equitable.  The broader shoulders are asked to carry the heavier burden. b.          It satisfies the canon of productivity as it yields

Indifference curves In order to explain indifference curves, we will again make the simplifying assumption that the consumer buys two goods, x and y. The table below gives

what is line balancing for paper machine?

Lots of states have scratch offs with various different monetary payoffs. For example, the "$500 a week for life" in New York offers the payout and odds structure noted below.

Prediction markets:   These are speculative markets fashioned with the intention of making predictions. Assets which are produced possess an ultimate cash worth bound to a specific

For the pair of supply and demand equations,where x represents the quantity demanded in units of a thousand and p the unit price in dollars, find the equilibrium quantity and the e

Q. What is Monopoly? The term 'Monopoly' has been derivative of Greek term 'Monopolies' that means a single seller. So, monopoly is a market condition in that there is a single

Explain the classification of oligopoly?