Holding a currency to the gold standard works:
A) to the advantage of savers at the expense of borrowers.
B) to the advantage of borrowers at the expense of savers.
C) for no one, and hurts both savers and borrowers from access to money.
D) for everyone, benefiting both savers and borrowers.

Question

Quizplus · Accepted Answer

Holding a currency to the gold standard means that the value of the currency is tied to the value of gold. This helps savers as the currency maintains its value over time, but it can be challenging for borrowers as the value of money increases in relation to goods and services. As a result, borrowing becomes more difficult and expensive. Therefore, the gold standard benefits savers at the expense of borrowers.

Holding a Currency to the Gold Standard Works