Question

Which one of the following is a part of economic environment?
(a) Public debt(s) Lifestyle of people fe) Technological changes (a) level of education​

Answer 1

Answer:

External and domestic debt is thought to be the main drivers of public debt. If beginning productivity is higher than the cost of investment, the analysis demonstrates that debt will enhance economic growth.

Explanation:

• The sum of all borrowings by the government to cover its development budget, including all obligations, is known as public debt.
• Hence the public debt is a part of the economic environment.

• The Indian Consolidated Fund must be used to pay for it. Although the Union government expressly differentiates its debt obligations from those of the states, the phrase is frequently used to refer to the total liabilities of both the federal and state governments.
• Since debt is so crucial to economic development, it needs to be measured properly to reflect its long-term effects. It is unfortunate that the ideal method is not to compare the national debt of the country to its GDP.
• By raising long-term interest rates, inflation, and future distortionary taxation, public debt can displace private investment and endanger economic progress.
• For example Any sum of money that a government entity owes is considered public debt. Money that a city owns to pay for a recently built sewer system is an illustration of public debt.