By the 1960s, those countries holding dollars were subsidizing the U.S. economy. What was unique about this situation?
A) U.S. budget deficits were decreasing at the time.
B) As the "dollar overhang" grew, foreign investors and governments were willing to purchase dollars at a discount.
C) The U.S. was able to pay $35 per ounce for gold despite its large "dollar overhang".
D) The costs of adjustment were not being forced onto the deficit country.
Correct Answer:
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