i want to know how much money govt. can print & how the perticular amount is calculated?
2006-09-13 22:42:25 · 5 answers · asked by chavva a 1 in Business & Finance ➔ Other - Business & Finance
There is no limit. However, if too much is placed in circulation, then you have more cash chasing the same amount of goods and services. That causes prices to go up. In extreme cases, like what is going on currently in Zimbabwe, far too much paper money is being printed, prices are going up very rapidly, and paper money eventually becomes worthless.
Other examples of this are Germany in 1922 - 1923, Yugoslavia in 1993, and to a lesser extent, Mexico in 1982.
2006-09-17 16:19:15 · answer #1 · answered by F. Frederick Skitty 7 · 0⤊ 0⤋
it depends upon how the government wants the country's economics to go. If it can afford a little inflation, the it will print more money. But if it wants to curb inflation, then it may pull the strings on printing. This is just one aspect. There are other aspects, which may determine the outcome, but i think this is the most important.
2006-09-13 22:49:58 · answer #2 · answered by smilingface 3 · 0⤊ 0⤋
Well my understanding is that they are NOT supposed to print more than we have which is suppose to be in Fort Knox. BUT do you really believe that we have all this much money in Fort Knox. I don't and I believe that they print as much as they want.
2006-09-13 22:52:07 · answer #3 · answered by GRUMPY 7 · 0⤊ 0⤋
In the US there is no limit, However the more you print the lower its value.
2006-09-13 22:50:52 · answer #4 · answered by N3WJL 5 · 0⤊ 0⤋
it is based on their foreign exchange reserves as well as gold and other precious reserves.
2006-09-13 22:44:31 · answer #5 · answered by Anonymous · 0⤊ 0⤋