Does it make more sense to debate the level of debt or the d

Does it make more sense to debate the level of debt or the debt to GDP ratio? Explain.

Solution

Only the level of debt doesn’t give the true picture of the economy. It can be misleading in the sense that it doesn’t give any information about how the economy is doing. Whereas, debt to GDP ratio gives a clearer picture. More debt with more GDP indicates positive growth as in thiugh the debt is high but so are the economic activities.