To finance government spending

To control inflation

To promote economic growth

To reduce unemployment

Government debt leads to higher interest rates

Government debt leads to lower interest rates

Government debt has no impact on interest rates

The relationship between government debt and interest rates is uncertain

The decrease in private investment caused by government borrowing

The increase in private investment caused by government borrowing

The decrease in government spending caused by private borrowing

The increase in government spending caused by private borrowing

Fiscal policy is conducted by the central bank, while monetary policy is conducted by the government.

Fiscal policy is conducted by the government, while monetary policy is conducted by the central bank.

Fiscal policy is used to control inflation, while monetary policy is used to promote economic growth.

Fiscal policy is used to promote economic growth, while monetary policy is used to control inflation.

To set interest rates

To purchase government bonds

To regulate the financial system

All of the above

To control inflation

To promote economic growth

To stabilize the financial system

All of the above

Open market operations

Reserve requirements

Discount rate

All of the above

Government debt can lead to economic growth

Government debt can lead to economic decline

Government debt has no impact on economic growth

The relationship between government debt and economic growth is uncertain

A budget deficit occurs when government spending exceeds tax revenues, while a budget surplus occurs when tax revenues exceed government spending.

A budget deficit occurs when tax revenues exceed government spending, while a budget surplus occurs when government spending exceeds tax revenues.

A budget deficit occurs when government spending equals tax revenues, while a budget surplus occurs when government spending exceeds tax revenues.

A budget deficit occurs when government spending equals tax revenues, while a budget surplus occurs when tax revenues exceed government spending.

To set interest rates

To purchase government bonds

To regulate the financial system

All of the above

Government debt can lead to a stronger exchange rate

Government debt can lead to a weaker exchange rate

Government debt has no impact on the exchange rate

The relationship between government debt and the exchange rate is uncertain

Internal debt is owed to domestic lenders, while external debt is owed to foreign lenders.

Internal debt is owed to foreign lenders, while external debt is owed to domestic lenders.

Internal debt is owed to both domestic and foreign lenders.

External debt is owed to both domestic and foreign lenders.

To set interest rates

To purchase foreign currency

To regulate the financial system

All of the above

A sovereign debt crisis occurs when a government is unable to repay its debts, while a banking crisis occurs when banks are unable to meet their obligations to depositors.

A sovereign debt crisis occurs when banks are unable to meet their obligations to depositors, while a banking crisis occurs when a government is unable to repay its debts.

A sovereign debt crisis and a banking crisis are the same thing.

A sovereign debt crisis and a banking crisis are unrelated.

Economic recession

Financial instability

Loss of confidence in the government

All of the above