question archive What happens when inflation makes it impossible for the US to pay interest on their debt?

What happens when inflation makes it impossible for the US to pay interest on their debt?

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What happens when inflation makes it impossible for the US to pay interest on their debt?

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Based on the current estimates, around $16 trillion of the US debt is included as public debt. There are three conditions where the US government do more to reduce the amount of national debt. They are:

1. The economy has outreached its national debt.

2. The government has a lot to forgot by cutting public spending.

3. Raise in taxation.

Since 1929, the amount of national debt exceeded for the US economy. for example-

1934, the debt increases to 25 billion.

Feb 11, 2019, the public debt increases up to $22 trillion.

When the rate of inflation is greater than its neutral point, the economy could face unlimited problems. This makes a tough situation for the US government to pay its debt amount. When the government is failed to do so, it led to hyperinflation, higher unemployment, instability, etc.