What does the debt-service ratio represent?

The External Debt and Financial Crises MCQs for PPSC, FPSC, NTS, and Pakistan government job tests. Select an option below, then read the explanation.

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Subject
The External Debt and Financial Criseseconomics-mcqs › the-external-debt-and-financial-crises
Published
27 May 2019
Last updated
28 May 2026

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Explanation

The debt-service ratio measures the burden of debt repayments by comparing the total interest and principal payments to the country's export earnings. This ratio helps assess a country's ability to meet its external debt obligations from its export revenues.

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