How did this punishment affect Germany economy?

Answer 1

The punitive measures imposed on Germany after World War I, particularly through the Treaty of Versailles, severely disrupted its economy. The reparations payments demanded from Germany contributed to hyperinflation in the early 1920s, leading to a collapse of the currency and widespread economic hardship. This instability fueled social unrest and contributed to the rise of extremist political movements, ultimately setting the stage for further conflict in Europe. The economic consequences were profound and long-lasting, impacting Germany's recovery and stability for years to come.