Under the Gold Standard:
A) nominal exchange rates were fixed.
B) real exchange rates were fixed.
C) nominal interest rates were fixed.
D) nominal exchange rates could float.
E) real interest rates were fixed.

Question

Quizplus · Accepted Answer

Under the Gold Standard, nominal exchange rates were fixed, meaning that the value of each country's currency was tied to a specific amount of gold. This fixed exchange rate system helped to promote stability in international trade and investment, but also had limitations and was eventually abandoned by most countries in the 20th century.