What is your view of the government's monetary policy during world war 2 ? why ?

The national debt of the United States was only 16 billion dollars in 1930 (169 billion dollars) and after the war, in 1946, it reached the record figure of 269 billion dollars, but with low interest rates. A 1939 dollar was equivalent to $ 1.17 in 1946, however, while the European countries were totally destroyed, the gross domestic product of the United States grew substantially.

uring the Allied Bretton Woods Conference in the United States, a system of monetary convertibility with fixed rates of exchange and free trade was devised. New financial institutions were established, such as the International Monetary Fund and the World Bank for Reconstruction and Development.

The war cost the United States 84 thousand 500 million dollars only for the manufacture of armaments, of which a huge amount went to the hands of the allied countries, including the Soviet Union.

In my opinion, the United States not only emerged politically victorious from the war, but its economic pre-eminence was clearly manifested. Once the conflict was over, this country concentrated most of the world's manufacturing capacity, as well as the greatest efforts in research and development.

Even more important was the increase in demand in a population that had sacrificed for war for several years. But the main problem that had to be faced in the late 1940s was inflation, which led to an increase in the cost of living. In these years there was a recession that could be solved by endogenous factors such as the Marshall Plan and the Korean War. The assistance provided to Western Europe and Japan helped to increase exports and investment in companies from the Old Continent by American companies.

the correct answer is b

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