Chapter 14, Problem 12AA

To determine

To evaluate:The causes for the bills of credit issued by the continental congress to become worthless during the Revolutionary War.

Explanation of Solution

Continentals refer to paper money provided by the 1775 Continental Congress for financial help for the Revolutionary War in the Americas. Continentals’ money quickly lost its value because this money was not backed by gold or silver and there were too many bills that were printed. There was no way for the federal government that could buy the money back. There was no official authority to collect taxes. The First Continental Congress, formed in reaction to the unbearable acts passed by the British Parliament in 1774, tried to help restore the frayed relationship between the government of British and its American colonies while at the same time defending the colonist interests.

Economics Concept Introduction

Introduction: Revolutionary War is the American War for independence fromBritain. The war started in 1775, with Concord and Lexington battle, and proceeded until the Yorktown War in 1781.