Which of the Following Statements Is True About the Gold

question 67

Multiple Choice

Which of the following statements is true about the gold standard?

• A)Given a common gold standard,the value of any currency in units of any other currency was easy to determine.
• B)Establishing a gold standard seemed impractical as the volume of international trade expanded in the wake of the Industrial Revolution.
• C)A drawback of the gold standard was that it failed to provide a mechanism for achieving balance-of-trade equilibrium by all countries.
• D)Under the gold standard,when a country has a trade deficit,there will be a net flow of gold from the other countries to that country.
• E)The gold standard refers to the use of gold coins as a medium of exchange between countries involved in international trade.

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Definitions:

Average Variable Cost

The variable cost (costs that change with production volume) divided by the quantity of output produced.

Marginal Cost

The increase or decrease in the total cost incurred by producing one additional unit of a product or service.

Total Variable Costs

The sum of expenses that vary directly with the level of output production.

Average Total Cost

The per unit cost of production, calculated by dividing total cost by the total quantity of output produced.