2007-09-11 17:55:00 · 3 answers · asked by Baharak S 1 in Social Science ➔ Economics
I mean like what happened in Turkey, a new currency is defined that is equal to for example 1000 units of the previous currency.
2007-09-12 18:55:05 · update #1
Do you mean having 1000 ments (cf 100 cents)to the dollar?
No, not at all. Can you think of any reasons why it would?
2007-09-11 19:03:29 · answer #1 · answered by jemhasb 7 · 0⤊ 0⤋
It really depends on how the current currency is being used. For example, if 100-unit pieces of paper are very popular, then introducing lots of 1,000-unit pieces of paper will be cumbersome for consumers and business, given that they would prefer smaller denominations.
However, if inflation has already eroded away the value of the currency and 10,000-unit pieces of paper are popular, then introduction of the new currency would have no real effect.
2007-09-13 10:44:16 · answer #2 · answered by Allan 6 · 0⤊ 0⤋
It would slow down the pace of transactions, and more people would probably turn to plastic as an alternative, as it would be a pain to figure out a new denomination(s) of coins/bills to produce.
2007-09-12 02:22:10 · answer #3 · answered by J.W. 2 · 0⤊ 0⤋