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A countrys GDP growth rate is 6%, the interest rate on its debt (all local currency) is 8%, and its debt-to-GDP ratio is 95%. What
A countrys GDP growth rate is 6%, the interest rate on its debt (all local currency) is 8%, and its debt-to-GDP ratio is 95%. What does the country have to do to keep its debt-to-GDP ratio below 100%?
A. Bring its primary deficit down to zero.
B. Raise its GDP growth rate to 8%.
C. Run a primary surplus of 8.05% of GDP.
D. Keep its primary deficit below 8.05% of GDP
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