Under the gold standard,if one United States dollar could be traded for one quarter of an ounce of gold,and one British pound could be redeemed for one half of an ounce of gold,the exchange rate would be

Question

Quizplus · Accepted Answer

Under the gold standard, the exchange rate is determined by the amount of gold each currency can be exchanged for. Since $1 is equivalent to 0.25 ounces of gold and £1 is equivalent to 0.5 ounces of gold, it takes $2 to equal the gold value of £1, making the exchange rate $2 = £1.

Under the Gold Standard,if One United States Dollar Could Be