Question

Governments have great control over their subjects, and one of the government’s privileges is that of printing money. As long as the government doesn’t abuse this privilege by inflating the currency, how can the government profit from this privilege?

Answer 1

Ans:- Printing money is one of the greatest privilege of government. But the government cannot print more money because it create inflation. If the government print more money the price of all things go up. But the government basically make profit from this privilege. Printing money is labeled as one of the source of income for government. The reason is that the value or worth of money is normally greater than the cost of printing money. The value of money is more than its production cost so the government make profit from Printing money. If the production cost is more than its value then the government undergoes loss.