To find the country's GDP in 20 years that would maintain the current debt-to-GDP ratio, follow these steps:
### Step 1: Understand the given data
- Current debt-to-GDP ratio: 10%, which can be expressed as 0.10.
- Future debt: 60 billion dollars.
### Step 2: Set up the formula for the debt-to-GDP ratio
The debt-to-GDP ratio is given by:
[tex]\[ \text{Debt-to-GDP Ratio} = \frac{\text{Debt}}{\text{GDP}} \][/tex]
We need to maintain the same ratio in the future. Hence, we can rearrange the formula to solve for the future GDP:
[tex]\[ \text{GDP} = \frac{\text{Debt}}{\text{Debt-to-GDP Ratio}} \][/tex]
### Step 3: Substitute the values into the formula
Using the future debt (60 billion dollars) and the current debt-to-GDP ratio (0.10), we substitute these values into our formula:
[tex]\[ \text{GDP} = \frac{60}{0.10} \][/tex]
### Step 4: Perform the calculation
[tex]\[ \text{GDP} = \frac{60}{0.10} = 600 \text{ billion dollars} \][/tex]
### Step 5: Select the correct answer
Based on the options given, the correct answer is:
C. 600 billion dollars
