Question on: JAMB Economics - 2012
A huge national debt is an indication that the gold reserves of a nation has
A
appreciated
B
decreased
C
depreciated
D
stagnated
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Correct Option: D
A huge national debt often arises when a country has borrowed extensively. This borrowing can sometimes be a result of, or be associated with, a depletion of a country's gold reserves. A country might sell its gold reserves to finance its spending or to service its debt. Therefore, a large national debt can indicate that the gold reserves have decreased.
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