One of the main reasons for hyperinflation episodes is ________.

Question

Quizplus · Accepted Answer

Large government budget deficits lead to an increase in the money supply as the government needs to print more money to finance their spending. This excess money supply can lead to hyperinflation as the value of the currency decreases rapidly. High tax rates, a decrease in real GDP, and a decrease in the demand for consumer goods may contribute to inflation but are not the main reason for hyperinflation.

One of the Main Reasons for Hyperinflation Episodes Is ________