Public debt owed to foreign governments, international institutions or overseas lenders is called:
Correct answer: B. External public debt
- A. Internal public debt
- B. External public debt
- C. Floating public debt
- D. Funded public debt
Explanation
External public debt is borrowed from creditors outside the country and creates obligations involving foreign lenders or international institutions. Internal debt is owed to residents and institutions within the country.
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About Public Finance
Government revenue and expenditure are analysed through taxation, public borrowing, budgets, subsidies, transfers and public debt. The topic explains how fiscal policy affects resource allocation, income distribution, economic stability and growth, while distinguishing direct from indirect taxes, progressive from regressive taxation, and public goods from goods supplied by private markets.
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