By limiting the growth of a nation's money supply, the gold standard was also effective at controlling ________.

Question

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By limiting the growth of a nation's money supply, the gold standard helped to prevent excessive inflationary pressures. The fixed exchange rate that was maintained under the gold standard required that the amount of money in circulation be tied to the amount of gold held in reserve. This meant that if more money was printed than was backed by gold reserves, people would begin to lose confidence in the currency and its value would decrease, leading to inflation. Therefore, by keeping a tight rein on the money supply, the gold standard was effective at controlling inflation.

By Limiting the Growth of a Nation's Money Supply, the Gold