USA HISTORY

Detailed explanation-1: -In the early 1870s, the global monetary system transitioned from bimetallism-a regime in which gold and silver currencies were tied at quasi-fixed exhange ratios-to the gold standard that was characterized by the use of (only) gold as the main currency metal by the largest and most advanced economies.

Detailed explanation-2: -A bimetallic standard, or bimetallism, is a monetary system in which a government recognizes coins composed of both gold or silver as legal tender.

Detailed explanation-3: -In a bimetallic system, the value of gold and silver is tied to each other. For example, the value of one ounce of gold might be worth 15 ounces of silver. The value ratio of the two would be 1 to 15. Governments would then use gold and silver to mint coins to use as money.

Detailed explanation-4: -Bimetallism was intended to increase the supply of money, stabilize prices, and facilitate setting exchange rates. Some scholars argued that bimetallism was inherently unstable owing to Gresham’s law, and that its replacement by a monometallic standard was inevitable.