The following table contains approximate figures for gross domestic product (GDP) and the national debt in the United States for June 2001 and June 2011. The national debt represents the total amount of money owed by the federal government to holders of U.S. securities. All numbers are in trillions of dollars. Total National GDP Debt Debt Held by Debt Held Outside Fed. Govt. and Fed. Reserve (Trilllons of (Trilllons of Federal Foreign Ownership U.S. Ownership Dollars) Dollars) Government (External National Debt) (External National Debt) and Federal (Trllllons of Dollars) (Trllllons of Dollars) Reserve (Trillion: of Dollars) June 2001 10.1 5.? 3.0 1.0 1.? June 2o11 15.2 14.3 4.6 4.5 5.2 Source: \"U.S. Treasury, Bureau of Economic Analysis.\" Net public debt is the portion of the national debt that is held outslo'e the federal government and the Federal Reserve System. In June 2001, the net public debt as a percentage of total national debt was In June 2001, the percentage of the U.S. national debt held by foreigners (external national debt) was The fraction of the national debt held by foreigners will eventually need to be repaid to foreigners, thereby reducing the collective purchasing power of Americans. Between 2001 and 2011, the fraction of the national debt held by foreigners The absolute level of the debt does not necessarily provide a clear indication of a nation's debt burden. Thus, economists often look at relative measures of the national debt. One possible relative measure of the national debt is the federal debt held by the public (outSide the federal government and the Federal Reserve) as a percentage of GDP. In 2001, publicly held debt was publicly held debt as a percentage of GDP of GDP. Between 2001 and 2011, Which of the following concerns about the national debt are substantive? Check all that apply. Paying off the U.S. national debt will require future generations of Americans to decrease their purchases of goods and services by an amount equal to the existing debt. As government securities mature, portions of the national debt come due. When this occurs, the only way for the government to obtain the necessary funds is to raise taxes or cut expenditures. The large U.S. national debt is in danger of bankrupting the federal government. Government's borrowing to refinance the debt may lead to higher interest rates. Higher interest rates reduce investment spending, leaving future generations with a smaller stock of capital goods.On the following graph, AD, represents the initial aggregate demand curve in a hypothetical economy, and AS represents the initial aggregate supply curve. The economy's full-employment output is $12 trillion. On the following graph, use the grey point (star symbol) to mark the equilibrium. (Note: You will not be graded on any adjustments made to the graph.) (? AS 108 105 Equilibrium 104 103 10 101 PRICE LEVEL (CPD) AD 2 100 AD 2 98 AD 97 Full Employment 7 8 9 10 11 13 14 15 16 REAL GDP (Trillions of dollars) The initial short-run equilibrium level of real GDP is $ trillion, and the initial short-run equilibrium price level isThe initial short-run equilibrium level of real GDP is $ trillion, and the initial short-run equilibrium price level is Suppose the government, seeking full employment, borrows money and increases its expenditures by the amount it believes necessary to close the output gap. According to critics of Keynesian fiscal policy, the government policy may result in complete crowding out. Which of the following aggregate demand curves shown in the previous graph would be consistent with complete crowding out? O AD1 O AD2 O AD: As a result, the equilibrium level of real GDP will be $ trillion, and the equilibrium price level will be According to critics of Keynesian fiscal policy, which of the following is true in this case? O The increase in deficit-financed government spending causes real GDP to increase, but not to full-employment output. O The increase in deficit-financed government spending causes real GDP to increase to full-employment output. O Real GDP does not increase; only the price level increases. O The increase in deficit-financed government spending has no impact on real GDP and the price level