Shahram Chaudhry
The most basic question we ask when we’re introduced to the concept of poverty as children is , “Why can’t we just print more money?” The answer to that could be that it would lead to inflation and decrease the value of the currency.
“Why does printing more money lead to inflation and decrease the value of the currency?”
A possible answer could be that printing more money increases the money supply without a corresponding increase in goods and services, creating supply demand issues.
“Why does an imbalance between supply and demand result in inflation?”
When there is more money in circulation relative to the available goods and services, people have more money to spend so the demand increases without the supply increasing causing prices to rise, resulting in inflation.
“Why does an increase in prices due to inflation decrease the value of the currency?“
When there is inflation, the purchasing power of each unit of currency decreases.
“Why does a decline in the exchange rate further reduce the value of a currency?“
When the exchange rate of a currency falls, it means that it can buy less of other currencies impacting international trade, increasing import costs etc.
In the comic, the character, let’s name him Abigail Johnson, tries printing money and then realizes that it has negative consequences such as inflation, and people not being able to buy the things that they were able to before.
