The Bretton Woods System Was One in Which Central Banks

question 51

Multiple Choice

The Bretton Woods system was one in which central banks

• A) agreed to limit domestic money growth to the average of the seven largest industrial nations.
• B) agreed not to intervene in the foreign exchange market to maintain a fixed exchange rate regime that had existed prior to World War I.
• C) agreed to limit domestic money growth to the average of the five largest industrial nations.
• D) bought and sold their own currencies to keep their exchange rates fixed.

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Definitions:

Fallacy of Composition

The erroneous belief or argument that what is true for a part is necessarily true for the whole group or entity.

Economic Relationships

The interactions between different variables within the economy, such as supply and demand, and price and quantity.

Average Variable Cost

The per-unit variable cost, determined by dividing the total variable costs by the number of units produced.

Marginal Revenue

The increase in profit from selling an extra unit of a good or service.