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Why can't the government produce more money?​

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2 votes

Answer:ask trump

Step-by-step explanation:

answered
User Peetya
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6 votes

Answer: The short answer to this question is that printing more money causes INFLATION.

Explanation: If for instance in the economy of a country, Wakanda, has £1 million worth of goods; e.g. 1 million books at £1 each. The supply of money in this economy at this time will be £1 million.

Supposing the government prints an additional £1 million, there will be more money with the same amount of books. This will make the demand for books to rise causing the books seller to increase their prices.(law of demand and demand).

What will likely play out here will be that as the money supply was doubled, we would have 1 million books sold at £2. The economy is now worth £2 million rather than £1million. But, the number of goods is exactly the same.

answered
User Wave
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