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What did the government do to control wartime inflation during World War II?

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sejjis12 | Student, Grade 10 | (Level 2) eNoter

Posted April 17, 2012 at 10:22 PM via web

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What did the government do to control wartime inflation during World War II?

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pohnpei397 | College Teacher | (Level 3) Distinguished Educator

Posted April 17, 2012 at 11:11 PM (Answer #1)

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The main thing that the government did to prevent this was to impose rationing using coupons rather than cash.  By doing this, the government prevented people from bidding up the prices of whatever consumer goods were still available.  Another thing that the government did was to borrow money.  During the war, there were many war bond drives in which the government persuaded the people to lend money to the government.  This soaked up much of the money that might otherwise have been the cause of inflation during the war.  By reducing the money supply and by making it harder to buy goods using cash, the government prevented inflation.

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