If the U.S. Treasury in 1865 had decided to make the dollar convertible into gold at the pre-War rate,

Question

Quizplus · Accepted Answer

Making the dollar convertible into gold at the pre-War rate would have made the dollar relatively strong, making British goods cheaper and more desirable in the U.S. (A). This increased demand for British goods could lead to an outflow of gold from the U.S. as Americans exchanged dollars for gold to pay for these goods, potentially depleting the U.S. Treasury's gold reserves (B). There's no direct reason given for why British citizens would convert large amounts of pounds into dollars (C), so only A and B are correct.

If the US Treasury in 1865 Had Decided to Make the Dollar