How much does the government owe at the start of period 2


Suppose the government owes $100 at the start of period 1 and pays an interest of $10 for that period. How much does the government owe at the start of period 2 if the primary deficit is equal to $25?

a. $110

b. $135

c. $145

d. $125

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Business Economics: How much does the government owe at the start of period 2
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