Chap002 35 - Topic: Classical Gold Standard: 1875-1914...

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27. Assume that a country is on the gold standard. In order to support unrestricted convertibility into gold, banknotes need to be backed by a gold reserve of some minimum stated ratio. In addition, A. the domestic money stock should rise and fall as gold flows in and out of the country. B. the central bank can control the money supply by buying or selling the foreign currencies. C. Both a) and b) Topic: Classical Gold Standard: 1875-1914 Topic: Evolution of the International Monetary System 28. Under the gold standard, international imbalances of payment will be corrected automatically under the A. Gresham Exchange Rate regime. B. European Monetary System. C. Price-specie-flow mechanism. D. Bretton Woods Accord.
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Unformatted text preview: Topic: Classical Gold Standard: 1875-1914 Topic: Evolution of the International Monetary System 29. During the period between World War I and World War II, A. the major European powers and the U.S. returned to the gold standard and fixed exchange rates. B. while most countries abandoned the gold standard during World War I, international trade and investment flourished during the interwar period under a coherent international monetary system. C. the U.S. dollar emerged as the dominant world currency, gradually replacing the British pound for the role. D. None of the above. Topic: Evolution of the International Monetary System Topic: Interwar Period...
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This note was uploaded on 11/09/2011 for the course FIN IFMG201 taught by Professor Eun during the Spring '11 term at Michigan Flint.

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