An important problem with the gold standard was that
A) it was too complicated and restricted business activity.
B) a country did not have control of its domestic monetary policy.
C) exchange rates tended to fluctuate a great deal, making it difficult for businesses to make long-run plans.
D) one country could easily manipulate the system to its advantage and the disadvantage of other countries.

Question

Quizplus · Accepted Answer

The gold standard restricted a country's ability to control its domestic monetary policy, as the money supply was tied to the amount of gold a country held. This made it difficult for countries to respond to economic shocks or fluctuations.

An Important Problem with the Gold Standard Was That