Throughout History Many Governments Have Financed Government Operations with the Printing

question 88

Essay

Throughout history many governments have financed government operations with the printing press, and paying government bills by increasing the money supply. The United States followed this path during the Civil War, approximately doubling the U.S. money supply between 1860 and 1865 using paper fiat money called Greenbacks. What do you think this rapid increase in the money supply did to inflation and inflationary expectations? Suppose the economy was in long-run equilibrium by the end of the war and the government began to remove Greenbacks and reduce the money supply. Use your understanding of the Phillips curve relationship to explain the effect on the economy.

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Definitions:

Not Elsewhere Classified

A term used in various categorization systems to label items that do not fit into the existing categories.

Obstetric Care

Medical care and treatment provided to women during pregnancy, childbirth, and the postpartum period.

ICD-10

The 10th revision of the International Statistical Classification of Diseases and Related Health Problems, a medical classification list by the World Health Organization.

Prenatal Checkup

is a series of medical appointments and tests conducted during pregnancy to monitor the health of the mother and the developing fetus.