Which of the following statements about public debt is accurate in the context of its impact on future economic growth?
1
Public debt has a non-linear relationship with economic growth, with moderate levels promoting growth and excessive debt leading to stagnation.
2
Public debt is irrelevant for economic growth in a small open economy.
3
Public debt accelerates economic growth in the short run but retards it in the long run due to higher interest payments.
4
Public debt, regardless of its size, always leads to a permanent increase in national income.