Understanding the Debt Ceiling

What is the primary function of a government's debt ceiling?

• To limit the amount of money a government can spend

• To set a legal limit on how much money a government can borrow

• To determine the interest rates on government loans

• To regulate the national budget

What could happen if the debt ceiling is not raised or suspended?

• The value of the US dollar will increase

• The government could default on its obligations

• The government will automatically receive more funds

• The national debt will decrease

What are Extraordinary Measures?

• Strategies to reduce government spending

• Permanent solutions to avoid breaching the debt ceiling

• Temporary accounting techniques to manage cash flow

• Methods to increase government revenue

How can Congress address the debt ceiling?

• By cutting all government spending

• By increasing interest rates

• By reducing the national debt

• By passing a bill to raise or suspend it

Which of the following is a strategy to manage national debt?

• Implementing structural reforms to entitlement programs

• Eliminating all government debt

• Increasing government salaries

• Reducing taxes on all citizens