Indebtedness Became a Major Problem in the World Economy in the 1980s

Multiple Choice

Indebtedness became a major problem in the world economy in the 1980s. Debt service must be met before other obligations of governments. Why did this happen?

A) recycled dollars from oil purchases were lent recklessly and rising interest rates later trapped borrowers
B) economic growth goals were too ambitious
C) banks raised interest rates and refused to negotiate new ones
D) previously colonial powers paid off debts