What is a debt-to-gdp ratio?
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The Debt to GDP ratio is typically used in comparing government debt to its GDP by dividing DEBT by GDP. Let’s look at an example. Here’s a chart of total US Federal public debt and US GDP:
The most recent values for each series are:
2016 Q2 | |
---|---|
Federal Debt: Total Public Debt | 19,382 |
US GDP | 18,437 |
So the current ratio for Federal Debt: Total Public Debt to US GDP (e.g. 19,382/18,437) is 105%. The ratio can be useful in comparing different country’s economies together or looking a trends of the ratio over time.
Written on September 2, 2016