One reason for the collapse of the gold standard in 1939 was the
A) difficulty and complexity in using the gold standard to determine the exchange rate.
B) agreement by governments to convert paper currency into gold on demand at a fixed rate.
C) cycle of competitive currency devaluations by various countries.
D) expansion in the volume of international trade after the Industrial Revolution.
E) inability of the gold standard to act as a mechanism for achieving balance-of-trade equilibrium by all countries.
Correct Answer:
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