What is called the result of a state's borrowing from its population, from foreign governments or from international institutions ?
Correct answer: C. Both of them
- A. National debt
- B. Public debt
- C. Both of them
- D. None of them
Explanation
Public debt is created when a government borrows from domestic citizens or institutions and from foreign governments or international organizations. National debt is often used as a near-synonym for the total public debt, so both terms fit here.
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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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