In the 1930s, some nations such as the United States and Britain abandoned their gold pegs by adopting ________, whereas other nations such as Germany and South American nations adopted ________.
A) floating exchange rates and open capital markets; fixed exchange rates and capital controls
B) fixed exchange rates and open capital markets; floating exchange rates without capital controls
C) fixed exchange rates and closed capital markets; floating exchange rates and closed capital markets
D) floating exchange rates with closed capital markets; floating exchange rates and open capital markets

Question

Quizplus · Accepted Answer

In the 1930s, nations like the United States and Britain moved away from the gold standard and adopted floating exchange rates along with open capital markets to manage their economies during the Great Depression. Conversely, countries such as Germany and those in South America opted for fixed exchange rates and implemented capital controls to stabilize their currencies and economies.

In the 1930s, Some Nations Such as the United States