UPSC Civil Services Prelims 2024
Question 3 of 75Indian Economy
Consider the following statements: Statement-I: If the United States of America (USA) were to default on its debt, holders of US Treasury Bonds will not be able to exercise their claims to receive payment. Statement-II: The USA Government debt is not backed by any hard assets, but only by the faith of the Government. Which one of the following is correct in respect of the above statements?
ABoth Statement-I and Statement-II are correct and Statement-II explains Statement-I.
BBoth Statement-I and Statement-II are correct, but Statement-II does not explain Statement-I.
CStatement-I is correct, but Statement-II is incorrect.
DStatement-I is incorrect, but Statement-II is correct.
Correct Answer
The correct answer is hidden
Explanation
43 words hidden ... face a failure of promised payment despite their legal claim, because the repayment capacity ultimately rests on the ... 35 words hidden