According to Oatley,the fundamental cause of collapse of the Bretton Woods international monetary system was
A) dollar overhang.
B) unfair advantages of the dollar as the reserve currency.
C) unstable gold prices.
D) speculative attacks on weak currencies.
E) governments' unwillingness to accept the domestic costs of balance-of payments adjustments.

Question

Quizplus · Accepted Answer

Oatley argues that the fundamental cause of the collapse of Bretton Woods was the governments' unwillingness to accept the domestic costs of balance-of-payments adjustments. The system required countries to adjust their exchange rates to address imbalances, but this often resulted in high inflation and unemployment. As a result, countries began to resist these adjustments and the system became unsustainable. The other options may have contributed to the collapse, but they were not the fundamental cause.

According to Oatley,the Fundamental Cause of Collapse of the Bretton