The collapse of the Bretton Woods system marked
A) the end of floating exchange rates and a move to fixed exchange rates.
B) marked the end of fixed exchange rates and a move to floating exchange rates.
C) the beginning of the gold standard.
D) a plunge in the price of gold.
E) the elimination of paper currencies.

Question

Quizplus · Accepted Answer

The Bretton Woods system was based on fixed exchange rates, but it collapsed in 1971 due to the imbalances in the system and the US's inability to maintain the value of the dollar. This marked the end of fixed exchange rates and paved the way for the adoption of floating exchange rates by most major economies.

The Collapse of the Bretton Woods System Marked