Question

What's a danger of adding a lot of made up

money to the economy?

A). Prices will deflate (decrease)
B). There is no danger
C). Prices will inflate (rise)

Answer 1

Answer: C) Prices will inflate

Step-by-step explanation:

C) Prices will inflate (rise) in the danger of adding a lot of made-up money to the economy. This is because adding a large amount of money to the economy increases the supply of money, which can lead to a decrease in the value of money and an increase in prices. This is known as inflation. When there is too much money chasing too few goods, prices go up and the value of money decreases. This can lead to a decrease in purchasing power, which can negatively affect the economy.