Under the gold standard, countries could not expand their money supply beyond what was allowed by the gold reserves held in their vaults.

Question

Quizplus · Accepted Answer

Under the gold standard, the value of a country's currency was directly linked to the amount of gold held in reserve. Therefore, countries could not expand their money supply beyond the gold reserves they possessed, as doing so would devalue their currency in relation to gold.

Under the Gold Standard, Countries Could Not Expand Their Money