ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The gold standard was the basis for the international monetary system from the 1870s to the early 1920s, and from the late 1920s to 1932 as well as from 1944 until 1971 when the United States unilaterally terminated convertibility of the US dollar to gold, effectively ending the Bretton Woods system.

Detailed explanation-2: -The U.S. abandoned the gold standard in 1971 to curb inflation and prevent foreign nations from overburdening the system by redeeming their dollars for gold.

Detailed explanation-3: -The gold standard is a monetary system where a currency is pegged to the price of a specific amount of gold. The U.S. was only ever on a true gold standard from 1879 to 1933. The Bretton Woods agreement attempted to create an international system with gold as a standard, but it failed.

Detailed explanation-4: -When and Why Did Nixon End the Gold Standard? President Richard Nixon closed the gold window in 1971 in order to address the country’s inflation problem and to discourage foreign governments from redeeming more and more dollars for gold.

Detailed explanation-5: -The gold standard is a monetary system where a country’s currency or paper money has a value directly linked to gold. With the gold standard, countries agreed to convert paper money into a fixed amount of gold. A country that uses the gold standard sets a fixed price for gold and buys and sells gold at that price.