How the german government finances its budget deficit

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After World War 1 Germany experienced one ofthe history's most speculator example of hyperinflation. TheGerman government did not pay for the war by taxing people moreheavily. Things got worse at the end of the war. A huge amount fordamages (reimbursement) was demanded from Germany. The sum to bepaid was fixed at £6,600,000 in 1921. Germany'scurrency loses confidence of many foreigners because Germany wasunable to pay for damages. German government has to face budgetdeficit because value of their currency decreased too much and theyhave to pay more in exchange for other currencies.

Keeping in view the above scenario, how the German Government finances its budget deficit after World War1?

Reference no: EM13244558

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