Question

Suppose the central bank in the nation of Zook attempts to pay off its national debt by printing large amounts of currency. The large increase in the money supply causes the price level to rise by 1,200 percent. What do you expect will happen to the value of Zook's currency?
Instructions: Round your answer to 2 decimal places.




The value of Zook's currency will

(Click to select)

by

percent.

Answer 1

Answer:

it would become worthless

Explanation:

if they keep printing loads of money then the individual Zook dollar would decrease in worth