Solution-Paying interest on the net foreign debt

Paying interest on the net foreign debt

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Reference no: EM132440713

Suppose that U.S. net foreign debt is 75 percent of U.S. GDP and that foreign assets and liabilities alike pay an interest rate of 3 percent per year. What would be the net drain on the U.S. (measured as a percent of GDP) from paying interest on the net foreign debt?

Reference no: EM132440713

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Paying interest on the net foreign debt

Reference no: EM132440713

Reference no: EM132440713

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