Sustainable Level of Government Debt (HL)

Question 1

Credit Rating

Answer 1

A measure of a borrower’s ability to repay loans.

Question 1

Government/National Debt

Answer 1

The sum of all debt accumulated and owed by the government.

Question 2

Debt Servicing Costs

Answer 2

The expenses of the government repaying the accumulated debt.

Question 3

Impacts of high government debt

Answer 3

• Debt servicing costs
• Credit ratings
• Impacts on future taxation and government spending