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16 November, 17:28

To pay for public works, the government would have to raise taxes or

a. print money

b. reduce inflation

c. borrow from foreign governments

d. borrow from banks?

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Answers (1)
  1. 16 November, 20:12
    0
    Let's look at the options:

    a. print money

    -this won't increase the amount of wealth, as the remaining money will loose value (inflation)

    b. reduce inflation

    -it's not very easy to reduce inflation and the governments can't just decide to reduce inflation.

    c. borrow from foreign governments

    -yes, I would say that this is the best answer! governments often do this.

    d. borrow from banks?

    -they could do this, yes, but they don't typically do this, as they would be dependent on the banks in this case.
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