Under a gold standard, a balance of payments disequilibrium would be corrected automatically by

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Under a gold standard, balance of payments disequilibria are automatically corrected by the flow of gold between countries. If a country has a deficit, gold flows out, reducing the money supply and causing prices to fall, which increases competitiveness and corrects the imbalance. Conversely, for a surplus, gold flows in, increasing the money supply and prices, reducing competitiveness, and correcting the surplus.

Under a Gold Standard, a Balance of Payments Disequilibrium Would