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Is having to make interest payments on the national debt detrimental to the economy? Or does the...

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Is having to make interest payments on the national debt detrimental to the economy? Or does the income bondholders receive offset the deadweight loss of taxation?

Debt

Dette is the French word from where the word Debt is originated. Debt means money, which is to be given to its rightful owner. Debt is comprised of both public and private debt. Interest is the extra charge or fine, which is given on the principal amount to the creditor.

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Yes, making interest payments on the national debt is detrimental to the economy. It put a burden on the exchequers of the country. High-interest...

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Long-Term Debt: Definition, Cost & Formula

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Chapter 8 / Lesson 7
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