Final answer:
The statement provided is true and refers to the process known as amortization, where a debt is paid down over time through regular payments of principal and interest.
Step-by-step explanation:
The sentence "The gradual retirement of a debt by means of periodic partial payments of principal and interest" describes the process of amortization, which is a common financial concept related to loans and mortgages. When a borrower makes a payment, it typically covers two components: the principal (the original amount borrowed) and the interest (the cost of borrowing the money). As the debt is paid down over time, less interest is owed because the principal balance decreases.
Government borrowing is done through instruments such as Treasury bonds, notes, and bills, and the funds raised can either be used to reduce the national debt or returned to taxpayers. The debt-to-GDP ratio can decrease even when a nation runs budget deficits if the GDP grows at a faster rate than the increase in debt. However, this falls under the larger framework of fiscal policy and economic health.
In conclusion, the statement presented is true, as it accurately describes the process by which a debt is retired through regular payments that include both the principal and interest.