Treasury bonds

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Gross federal debt was greater than $16 trillion

at the end of 2012. Historically, interest rates on

Treasury bonds have been considerably higher

than they were in 2012. Assume, for simplicity,

that the government pays the same interest rate

on all outstanding debt. What is the approximate

annual interest payment if the debt is $16 trillion

and the interest rate is:

a. 0.5%?

b. 3%?

c. 5%?

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