Note 1-37

37 This relationship is expressed by the following formula: bt = dt + bt-1[(l + r)/(l + g)] where, bt : current term debt outstanding (relative to nominal GDP) bt-1: preceding term debt outstanding (relative to nominal GDP) dt : current term primary deficit (relative to nominal GDP) r : nominal interest rates g : nominal GDP growth rates The formula indicates that when nominal interest rates and nominal GDP growth rates are equal (r = g) and primary balance is achieved (d = 0), the current term debt outstanding is equal to the preceding term debt outstanding (bt = bt-1).