In the past, some governments' budget deficits became so large that they could not raise sufficient taxes to finance the spending, so they ________, which led to ________.
A. printed large quantities of paper money; hyperinflation
B. reduced the amount of currency held by the public; a smaller money supply
C. increased bank reserves; a larger reserve/deposit ratio
D. ordered the central bank to sell government bonds; an increase in the money supply
Answer: A
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