Which of the following is a reason for the emergence of the gold standard?
A)Expansion in the volume of international trade due to the Industrial Revolution
B)Inability of governments to convert gold into paper currency on demand at a fixed rate
C)Widening gap between the developed and the developing nations
D)Failure of the Bretton Woods fixed exchange rate system
E)Failure of the U.S. dollar to act as a reference currency

Question

Quizplus · Accepted Answer

As the volume of international trade expanded in the wake of the Industrial Revolution, a more convenient means of financing international trade was needed. Shipping large quantities of gold and silver around the world to finance international trade seemed impractical. The solution adopted was to arrange for payment in paper currency and for governments to agree to convert the paper currency into gold on demand at a fixed rate.

Which of the Following Is a Reason for the Emergence