ECONOMICS (CBSE/UGC NET)

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ECONOMICS

FINANCIAL MARKETS

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
From 1876 to 1913, exchange rates were dictated by the ____ Each currency was convertible into gold at a specified rate. Thus, the exchange rate between two currencies was determined by their relative convertibility rates per ounce of gold. Each country used gold to support its currency.
A
Gold Regime
B
Gold Standard
C
Gold Equivalent
D
Gold Exhange Rate
Explanation: 

Detailed explanation-1: -In 1958, the Bretton Woods system became fully functional as currencies became convertible. Countries settled international balances in dollars, and US dollars were convertible to gold at a fixed exchange rate of $35 an ounce.

Detailed explanation-2: -End of Bretton Woods system In August 1971, U.S. President Richard Nixon announced the “temporary” suspension of the dollar’s convertibility into gold. While the dollar had struggled throughout most of the 1960s within the parity established at Bretton Woods, this crisis marked the breakdown of the system.

Detailed explanation-3: -The Gold Standard was a system under which nearly all countries fixed the value of their currencies in terms of a specified amount of gold, or linked their currency to that of a country which did so.

Detailed explanation-4: -Which of the following describes what happened to the gold trade as the use of gold as currency became more standardized? People began to write checks instead of actually transferring gold.

There is 1 question to complete.
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