Answer to Question #121776 in Macroeconomics for sondos

Question

Greece lightning
what has been the impact of successive budget deficits on public sectors borrowing and debt in Greece ?

Answer 1

Greece's debt has impacted the public sector by the increased debt when the government borrows from the private sector. Successive budget deficits has also led to increased rate of debt interest payments and also an increased aggregate demand. There is also an increase in interest rates or bond yields in the private sector.