Question

Consider the economy of Athenia. In 2018, Athenia has a GDP of $100 billion and a net national debt of $50 billion. Over the next 5 years, Athenia experiences economic growth, increasing its GDP to $120 billion in 2023. During the same 5 year period, the net national debt increases to $55 billion.

Answer 1

Answer:

Note: after an online research I found the questions. Comparing the debt ratios and analyze the causes of change.

Explanation:

Athenia’s debt ratio in 2018 is 50 % ( 50/100)

Athenia ‘s debt raiot in 2023 is 45.8% ( 55/120)

During this period, Economy of Athenia has increased larger than the debt. Hence, debt to GDP ratio has declined.

thus, the ratios changed because the economy grew a higher than the national debt.

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