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Debt-To-GDP Ratio

Debt-To-GDP Ratio

The Debt-To-GDP Ratio is the metric comparing a country's public debt to its gross domestic product (GDP). A high debt-to-GDP ratio means that a government owes a lot of money in comparison to the size of its economy. This can be problematic because it can limit the government's ability to borrow more money, invest in infrastructure, or provide social services.
There are several factors that contribute to a country's debt-to-GDP ratio. One is how much revenue the government collects from taxes. If tax revenue is low, then the government will have to borrow more money to finance its operations. Another factor is how much the government spends on things like defense and social welfare programs. If spending is high, then the debt-to-GDP ratio will be higher.
A number of countries around the world are struggling with high levels of public debt. In some cases, this has led to financial instability and even defaulting on loans. It remains to be seen whether these countries will be able to get their debts under control and return their economies back onto a path of growth."
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