Question

A country is said to be in a dept trap if _________.

A It has to abide by the conditionalities imposed by the International Monetary Fund Correct Answer Incorrect Answer
B It has to borrow to make interest payments on outstanding loans Correct Answer Incorrect Answer
C It has been refused loans or aid by creditors abroad Correct Answer Incorrect Answer
D The World Bank charges a very high rate of interest on outstanding & new loans Correct Answer Incorrect Answer

Solution

The correct answer is A

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