In a country on a gold standard, the quantity of money is determined by the:
A) government.
B) central bank.
C) amount of gold.
D) buying and selling of government securities.

Question

Quizplus · Accepted Answer

In a country on a gold standard, the quantity of money is determined by the amount of gold. The government or central bank cannot increase the money supply beyond the amount of gold reserves they possess. Buying and selling of government securities may affect interest rates, but not the quantity of money in circulation.

In a Country on a Gold Standard, the Quantity of Money