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Q.

Why are there economic ups and downs because of overprinting of money?

Tags: advertising & marketing, politics & government, economic ups
Asked by Tanveer Khara, 27 Apr '11 01:03 pm
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Answers (5)

1.

If the government printed more money. It would create inflation. The price of goods would rise, it would have to increase benefits and wages inline with inflation. Government spending would rise because of inflation. Borrowers would require higher interest rates to buy bonds. Printing money would not solve the problem but create additional problems of inflation.
Printing more money is exactly what Weimar Germany did in 1922. To meet Allied reparations, they printed more money; this caused the hyper inflation of the 1920s. The hyper inflation led to the collapse of the economy.
Answered by LIPSIKA, 27 Apr '11 01:12 pm

 
  
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2.

Not only overprinting ; printing of Bigger denomination notes like Rs.500/- or 1,000/- be abolished so that we shall be able to control bribnery in every sphere to some extent. Just think of Carrying ten rupee note bundles to bribe 1 Lakh or Crore to a person !!!!!
Answered by UNNIKRISHNA RAMAN, 27 Apr '11 02:55 pm

 
  
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3.

Various factors will be taken into consideration
Answered by veeravenkata satyanarayana, 27 Apr '11 01:48 pm

 
  
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4.

No its because of inflation & international economic cliamate
Answered by sushil trivedi, 27 Apr '11 01:12 pm

 
  
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5.

No...its due to monetary policy
Answered by alternate, 27 Apr '11 01:05 pm

 
  
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