medium · Corporate Credit Analysis
A sovereign has a current Debt/GDP ratio (d_t-1) of 80%. The effective nominal interest rate (r) is 5%, the nominal GDP growth rate (g) is 3%, and the primary balance (pb) is a deficit of 2% of GDP.
What will be the Debt/GDP ratio (d_t) at the end of the next period?
- 81.6%
- 80.4%
- 85.0%
- 83.6%
Sign up free to see the explanation and track your rank →
More Corporate Credit Analysis practice
- Apex Manufacturing has a total exposure at default (EAD) of… — What is the annual expected
- What is the company's Funds From Operations (FFO)?
- Which statement best reflects the credit risk synthesis?
- A credit agreement requires a borrower to maintain a Net Lev… — What type of covenant is t
- Using the Merton structural model intuition, if a company's equity volatility (sigma_V) in
- What is its CET1 ratio?
- If EBITDA is $150M, what is the entry leverage multiple?
- What is its EBITDA/Interest coverage ratio?