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26 October, 13:30

What is one reason why a government will deliberately inflate its national money supply?

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Answers (2)
  1. 26 October, 14:38
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    To attract oversea investors and working immigrants
  2. 26 October, 15:12
    0
    To increase aggregate demand

    Explanation:

    Inflation of national money supply is one of the tools of the monetary authority, that is the central bank of a country to stimulate aggregate demand. Government resort to increasing the money supply when it embarks on expansionary monetary policy to achieve certain macroeconomic goals or objectives. some of the monetary policy tools used to achieve this are : interest rate, reserve requirement, e. t. c.
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