What caused inflation to occur in Spain during the time of exploration?

The correct answer highlights the significant influx of gold and silver from the New World as a pivotal factor that caused inflation in Spain during the Age of Exploration. This period, particularly the 16th century, saw Spanish explorers and conquistadors extracting vast amounts of precious metals from territories in the Americas, such as Peru and Mexico. The enormous quantities of gold and silver that flowed back to Spain fundamentally altered the Spanish economy.

As the supply of money increased dramatically due to these precious metals, it led to a devaluation of currency, which in turn caused prices of goods to rise. This phenomenon is commonly referred to as inflation, where the value of money diminishes relative to the prices of goods and services. Thus, the shipping of these riches contributed directly to an elevated inflation rate, impacting the economic stability of Spain and influencing trade dynamics within Europe.

The other options do not accurately represent the primary cause of inflation during this time. While a population increase can lead to greater demand for goods, it was not the primary driver of inflation during the Age of Exploration. High taxes on imports might affect trade and the cost of goods but did not initiate the inflationary trend caused by the influx of precious metals. A decrease in trade with other nations could potentially have an impact on