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tester [92]
2 years ago
11

King George III repealed the Stamp Act after which American leader warned him of a consequential revolution?

History
1 answer:
klio [65]2 years ago
4 0

King George III repealed the Stamp Act after Benjamin Franklin warned him of a consequential revolution.

The Stamp Act of 1765 was meant to force a direct tax on the British colonies over printed paper, imposing the colonies to only use paper produced in London with a stamp on it.

American leader Benjamin Franklin warned the House of Commons of the massive loss of respect and consenquential revolution due to the discontent this would produce, so this Act was repealed.

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Ok, let me try to resume.

When the central bank injects reserves, it encourages banks to lend out money at lower interest, attracting borrowers for this money and leading entrepreneurs to invest, once the higher interest rates would not be profitable. Interest rates coordinate savers and investors action. Investment requires resources to be frozen rather than consumed, meaning that less spending by the population reflects more resources available to fund these investments, resulting in a lower rate of interest.

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Now, finally going back into the answer.

During the late 1920s rates were kept artificially low by the Federal Reserve, sparking a boom, specially in the stock market, with prices rising up to 50 percent quickly. In 1929, once the government started tightening credit to cool down the overheated stock market it produced, the burst happened, leading the country into the Great Depression.

Sorry for the long explanation, hope you understand the concept ;)

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