The gold standard in place at the start of the Great Depression of the 1930s
A) Helped to stabilize the financial system and the economy
B) Constrained the ability of the Fed to respond to the weakening financial system and economy
C) Was irrelevant to the course of events during this period
D) All of the above

Question

Quizplus · Accepted Answer

The gold standard limited the Federal Reserve's ability to expand the money supply to stimulate the economy, as currency was backed by gold reserves. This constraint hindered efforts to combat the economic downturn.

The Gold Standard in Place at the Start of the Great