Which of the following correctly describes the economic situation in the Confederacy during the war?

A.
The Southern economy was a largely moneyless economy because of its high production of agricultural goods, which led the economy to be much stronger during the war years than expected.

B.
The Confederate government faced a severe shortage of funds and attempted to solve that problem by printing additional currency, which led to severe inflation.

C.
The Confederate government faced the challenge of supporting the war effort financially without large tax increases and solved that challenge by selling war bonds, which helped them avoid the danger of inflation.

D.
Most Southern plantations had been extremely profitable for decades, allowing their owners to save huge sums of money, which were then used to finance the war efforts with much less difficulty than expected.

Respuesta :

The Civil War caused economic problems in the South as B.  The Confederate government faced a severe shortage of funds and attempted to solve that problem by printing additional currency, which led to severe inflation.

When the Civil War started, the Union blockaded the South such that they had to resort to certain strategies to raise money such as:

  • Printing additional currency
  • Imposing a war tax
  • Appropriation of Northern property in the South

The printing of additional currency known as Confederate dollars led to high inflation which the South had to ensure till they were defeated.

In conclusion, the Confederates printed cash and got inflation.

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