A Major Advantage of a Specie Standard as an Exchange

question 53

Multiple Choice

A major advantage of a specie standard as an exchange rate regime is

• A) discretionary monetary policy is effective.
• B) the currency is guaranteed to appreciate.
• C) exchange rates are stable.
• D) none of the above.

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Definitions:

Allocating Risk

The process of identifying and distributing the potential financial, operational, or legal hazards among parties in a transaction or agreement.

Contract Law

A branch of law that deals with agreements between parties, their rights, and obligations.

Consideration

In contract law, consideration refers to something of value exchanged between parties that is necessary for a valid contract.

Binding Contract

A legal agreement between two or more parties that is enforceable by law.