Economics question: What exactly causes the value of money to go down if more money is in production? Answered
Ok, so I do know that if the amount of money in circulation increases, the value of it goes down, but what exactly makes the value go down? Why would it go down instead of just stay the same?
In addition to this question, I would like to know how the general public and the government would know about money losing it's value, thus increasing their prices of the goods and services they sell.