Recall the Application about the study by Thomas J. Sargent of hyperinflations after World War I in Germany, Austria, Hungary, and Poland, and how those hyperinflations ended, to answer the following question(s).
-According to this Application, Sargent found that in each of the four cases studied, hyperinflation ended
A) when governments stopped relying on their central banks to finance their debt and instead sold their debt to private parties.
B) when governments stopped relying on private parties to finance their debt and instead sold their debt to their central banks.
C) when central banks stopped issuing money and instead relied on increased tax revenues to finance government debt.
D) when governments implemented austerity programs which banned the issuance of any new government bonds.

Question

Quizplus · Accepted Answer

Sargent found that hyperinflation ended when governments stopped relying on their central banks to finance their debt and instead sold their debt to private parties. This reduced the pressure on central banks to print money to finance government spending, which in turn helped to stabilize the economy and prevent further hyperinflation.

Recall the Application About the Study by Thomas J